Solar A Key Renewable Feature

GlobalData's has released the report, “Alternative Energy Quarterly Deals Analysis - M&A and Investment Trends, Q1 2011” to discuss trends and analysis on the mergers and acquisitions (M&A) and financings in the alternative energy market. The report provides information on mergers and acquisitions (M&A), equity/debt offerings, private equity and venture capital (PE/VC) and partnership transactions registered in the alternative energy industry in Q1 2011. There is comparative data on the number of deals and their value in the past five quarters, categorized into deal types, segments and geographies. Additionally, the report discloses information on the top PE/VC and advisory firms in the alternative energy industry. .

Investments in alternative energy companies, including new investments through equity/debt and financing by PE/VC firms, recorded a decrease of 28% in deal value and 15% in the number of deals with 180 deals worth $42 billion in Q1 2011, as compared to 211 deals worth $58 billion in Q4 2010. The large difference in deal value was primarily due to Ecopetrol's announcement of public offering of bonds for $18.1 billion recorded in Q4 2010. Excluding the Ecopetrol deal, investments in the alternative energy market remained almost unchanged with $40 billion in Q4 2010 and $42 billion in Q1 2011. The majority of new investments focused on wind, hydro and solar energy segments with $16.6 billion, $16 billion and $14.3 billion respectively in Q1 2011.The emerging countries along with developed nations are creating a healthy environment through policy changes, tax incentives and grants to help companies achieve the change of energy mix. The supply concern and soaring commodity prices also made governments to hasten the approval process for the development of new renewable projects. These projects are set to drive new investments in the alternative energy market. 

According to Raghunandan Kothamasu, Analyst at GlobalData, “Even though there is a dip in investments in Q1 2011, this year will experience a significant growth in renewable power investments globally. Canada, China and India are some of the emerging countries globally which are expected to have high renewable energy investments this year. Besides, the US, Germany and the UK will continue to invest significantly in wind and solar technologies.” 

M&As, which include change in ownership and control of companies, (GlobalData does not consider this value as a new investment in the market), registered a substantial increase in deal value from $18.4 billion in Q4 2010 to $50.1 billion in Q1 2011. The substantial increase in deal value could be due to the significant deal of Duke Energy's agreement to merge with Progress Energy, valued at $25.9 billion. However, the number of deals decreased marginally from 108 deals in Q4 2010 to 102 deals in Q1 2011. In the number of deals, M&A activity was prominent in the promising solar energy sector, with companies making huge investments for building their product portfolio. The sector registered 30 deals in Q1 2011.