Clean Technology Venture Investment Falls to $1 Billion in 1Q09
Posted on: Wednesday, 1 April 2009, 07:00 CDT
Governments step up to support clean technology with $400 billion in global stimulus spending
SAN FRANCISCO, April 1 /PRNewswire/ -- The Cleantech Group(TM), founders of the cleantech sector and providers of leading global market research and financial services for the cleantech ecosystem, along with Deloitte, which together with its affiliates provides audit, tax, consulting and financial advisory services to cleantech companies, today released preliminary 1Q09 results for clean technology venture investments in North America, Europe, China and India, totaling $1.0 billion across 82 companies.
The 1Q09 total is down 41 percent from the previous quarter, and down 48 percent from the same period a year ago. Cleantech venture investments have now declined for two consecutive quarters since peaking at $2.6 billion in 3Q08, representing the lowest level of venture capital investment in clean technology companies in two years. The average round size has contracted from $20 million in 3Q08 to $ 12.3 million in 1Q09.
"Cleantech financing is moving into a new phase, characterized by diversified funding sources, as the global recession and liquidity issues impact venture investors. Venture funds continue to invest significant sums, albeit at a slower pace and smaller scale than in the past two years," said Brian Fan, Senior Director of Research, Cleantech Group.
Meanwhile, governments globally are allocating historic amounts of capital to clean technologies through stimulus packages, loan guarantees and tax incentives, which will enable the cleantech industry to continue to develop. A report titled 'Towards a Global Green Recovery' to be presented at the G20 Summit in London later this week estimates that almost $400 billion of some USD $2.6 trillion in economic stimulus allocations announced so far by G20 nations are earmarked for clean technologies such as renewable energy, improved electrical grids and cleaner cars.
Additionally, utilities and corporations are increasingly playing a leadership role in developing the sector. "Governments are not the only significant new investors in cleantech...Utilities are also stepping up to fill the funding void and making equity investments in companies," said Scott Smith, Leader of CleanTech for Deloitte. "Investment plans range from building and operating solar and wind systems to financing third party, shovel-ready projects. These moves underscore cleantech's emergence as a significant and maturing market that will remain highly relevant--both during and following the economic downturn."
BY TECHNOLOGY SECTOR
The leading investment areas from the quarter were solar, biofuels, advanced batteries and electric vehicles.
-- SOLAR - $346 million
Deals included Norsun, a Norwegian polysilicon producer, which raised
a $72 million round led by Good Energies. Concentrated PV startup
SolFocus raised $67 million from Apex Venture Partners, NEA and NGEN.
Solar service provider Solar Power Partners raised $47 million, and
thin-film startup Sierra Solar Power raised $40 million.
-- BIOFUELS - $96 million
Deals included BioMCN, which has developed a process to convert crude
glycerine, a byproduct of biodiesel, into methanol. It raised $46
million from Waterland Private Equity. Cellulosic ethanol company
ZeaChem raised a $34 million round led by Globespan Partners and
Prairie Gold Venture Partners.
-- ADVANCED BATTERIES - $94 million
Deals included lithium-ion startup Boston Power, which raised a $55
million round led by Swedish investor Foundation Asset Management.
Boston Power's Sonata batteries were chosen by HP for nearly 70% of
its consumer line of notebooks. UK-based Nexeon raised over $14
million from Invesco Perpetual and others for its silicon anode
technology for lithium-ion batteries, while Swiss startup ReVolt
Technology raised over $13 million for its Zinc-air battery
technology for consumer electronics devices.
-- ELECTRIC VEHICLES - $78 million
Deals included Dutch transmission manufacturer Fallbrook
Technologies, which raised $25 million from NGEN Partners and
Robeco. Scuderi Group raised $20 million for its split cycle
internal combustion engine, PHEV manufacturer Bright Automotive
raised $11 million from White Pines Partners and Duke Energy, and
Smith Electric Vehicles, which manufactures electric trucks and vans,
raised $10 million.
M&As and IPOs
Clean technology M&A totaled an estimated 111 transactions in 1Q09, of which totals were disclosed for 25 transactions totaling $3.0 billion. This is down 42% from 4Q08, which saw 134 M&A transactions, of which 45 were disclosed for a total of $4.8 billion.
Cleantech Group noted four cleantech IPOs in 1Q09, three in China and one in Switzerland. The largest deal was China Singyes Solar Technologies Holdings Ltd, a solar service provider, which raised $8.1 million on the Hong Kong Futures Exchange.
BY GEOGRAPHY
North America accounted for 68% of the total, while Europe and Israel accounted for 28%, China for 2%, and India for 1%.
-- EUROPE: European and Israeli companies raised USD $281 million in 31
disclosed rounds, down 11% from 4Q08 and down 31% from 1Q08. Despite
the overall reduction in amount invested, Europe and Israel increased
its proportion of overall global investment to 28%, up from 19% in
4Q08 and 21% in 1Q08.
The largest deal was a USD $71.6 million round for Norwegian solar
company Norsun, one of the top ten largest deals ever in Europe and
Israel, and pulled Norway ($79.2 million in 4 deals) into first
position in the country rankings in Europe. The UK was second ($52.9
million, 11 deals) and the Netherlands third (where BioMCN's $46
million round was the only investment of disclosed value).
-- CHINA: In 1Q09, two Chinese companies, solar equipment company
Jiangyin Aikang Solar Equipment Co., and Shanghai Insuring Polymer
Materials Co., Ltd. raised USD $21.5 million.
There were seven M&A deals in China totaling USD $517.5 million;
three of these transactions were joint ventures between Chinese
companies and multinationals. Cleantech Group noted three cleantech
IPOs in China in 1Q09: China Singyes Solar Technologies Holdings Ltd
on the Hong Kong stock market, heat exchange manufacturer SmartHeat
on NASDAQ, and sustainable fertilizer manufacturer China Green
Agriculture Inc. on AMEX.
-- INDIA: In 1Q09, a total of USD $54 million was invested across 3
deals, out of which one company did not disclose the amount. Jain
Irrigation, India's largest provider of micro-irrigation systems; Sri
Biotech, an agri-biotech company and Polygenta all received funding
in the quarter. Active investors include IFC, Rabo Equity and Aloe
Private Equity. ACME Group, an India-based telecom power solutions
company also made an overseas investment of $30 million in
California-based eSolar and PAE acquired a strategic stake in Shurjo
Energy, a solar panel manufacturer, for $10 million.
Despite the low investment amount and number of deals recorded in the
region, the renewable energy sector in India continues to be very
active. Major Indian companies, such as Tata Power, BHEL and Greenko
Group, announced initiatives to ramp up investment in clean energy
projects across the country. Several Indian state governments in
India also announced policies this quarter to increase the use of
solar power and biomass for energy generation.
TOP INVESTORS:
1Q09 Most Active Cleantech Venture Funds
Venture Capital Firm # of rounds Companies
Kleiner Perkins 4 Alta Devices, Fisker Automotive,
Caufield & Byers Silver Spring Networks, Think Global
21Ventures 3 Advanced Hydro, Graphene Energy,
Variable Wind Solutions
CMEA Ventures 3 CFX Battery Inc., Draths Corp,
SuperProtonic
Quercus Trust 3 Advanced Hydro, Graphene Energy,
Sencera International
Key takeaways reviewed in webinar next week
The Cleantech Group and Deloitte will review key findings of their 1Q09 data in a live webinar on April 7, 2009 at 11AM EDT / 8AM PDT / 15:00 GMT, exclusively for members of the Cleantech Group's Cleantech Network. Network members may join the live meeting at http://cleantech.acrobat.com/research/ a few minutes before 8AM PDT, and will need their email address and Cleantech Network password to log in. Members unsure of their passwords can contact Cleantech Group at +1 810-224-4310 x.7151 or can retrieve their password at http://cleantech.com/memberpassword.cfm.
This press release is not a research report and nothing herein is intended to be nor should be construed as investment advice. Neither Cleantech Group, LLC nor Deloitte recommends that any financial product should be bought, sold or held by you, and nothing in this press release should be construed as an offer, nor the solicitation of an offer, to buy or sell securities by Cleantech Group, LLC or Deloitte. You should not make any investment decision without consulting a fully qualified financial adviser.
About the Cleantech Group, LLC
The Cleantech Group pioneered the cleantech sector in 2002. Today, it accelerates the development and market adoption of clean technologies globally through membership in the largest global network of investors and companies representing more than $3 trillion in assets. Member investors, growth companies/vendors, enterprises, service providers, and others receive access to capital, investment deal flow, market leading research and data, insight, sales leads, human capital, and promotional opportunities. The Cleantech Group also produces the premier Cleantech Forum events worldwide. Details at http://www.cleantech.com.
About Deloitte
As used in this document, "Deloitte" means Deloitte & Touche LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries.
SOURCE Cleantech Group, LLC
Source: PR Newswire
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