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Green-tech mergers, acquisitions and capital raises fell in 2009

January 15, 2010 |  7:09 pm
The number and value of green-tech mergers, acquisitions and capital raises in the U.S. dropped in 2009, according to a new report.

Overall, there were 248 deals -- 188 capital raises and 60 acquisitions -- worth a total of $9.5 billion, according to New York-based investment bank Peachtree Green Advisors. The volume of transactions was down 14% from the 289 deals recorded in 2008, and the value dropped 4% from the $9.9 billion that year.

The distribution, storage and efficiency sector had the most transactions, with 90, or 36% of the aggregate. Biofuels saw the steepest decline, with just 27 deals in 2009, compared with 69 in 2008.

The wind industry had deals with the highest value, a combined $3.1 billion, or 32% of the total transaction dollars from 2009. The amount was more than a billion dollars higher than the 2008 total, a 52% boost.

With $2.1 billion, or 22% of the total, the distribution, storage and efficiency sector came in next. The solar and bio sectors each represented 20%.

Deal value in the solar category plunged to $1.9 billion from $3.5 billion in 2008, in part because of the recession, the cost of developing utility-scale solar farms, tight credit and investor concerns.

And capital investment in solar slid 62%, to $1.2 billion from $3.2 billion, while volume fell 31%, to 47 deals from 68. The amount of funding funneled into the wind industry saw an “astounding” 907% upswing to $2.3 billion from $224 million the year before, when there was tightening credit, declining prices for natural gas and oil and the upcoming presidential election, according to Peachtree.

Across all sectors, the overall declines were offset by huge bundles of funding -- more than $30 billion to be used in 2009 and beyond -- from the Department of Energy through the American Recovery and Reinvestment Act, according to Peachtree.

The largest private raise of 2009 was Argonaut Private Equity’s $198-million investment in Fremont-based solar photovoltaics company Solyndra.

But the Department of Energy awarded several grants in amounts that private investors would have had little chance to match. The government agency gave $528-million and $535-million loan guarantees to Irvine-based hybrid sports-car maker Fisker Automotive and Solyndra. It also invested $334 million in carbon sequestration efforts by American Electric Power in Columbus, Ohio.

-- Tiffany Hsu
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