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Solar sector gets $189 mn in VC funding in Q2 2013

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Deepa
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AUSTIN, USA: Solar venture capital (VC) investments increased to $189 million (M) in 19 deals in Q2 2013 compared to $126 million in 26 deals in Q1 2013. Research and consulting firm Mercom Capital Group finds that solar downstream companies received most of the funding with $128 million.

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Total corporate funding in the solar sector including, VC funding, debt financing and other types of funding raised by public companies through sale of shares totaled $915 million.

"With solar technology companies struggling, investments have been going to downstream companies," commented Raj Prabhu, CEO, Mercom Capital Group. "That said, investments into solar technology companies haven't completely dried up. Small venture rounds are still going to several niche technology companies instead of the larger deals that were typical for thin film, CSP and CPV companies."

The largest VC deals in Q2 2013 included $69 million raised by Chinese developer Hefei Golden Sun Energy Technology. Clean Power Finance raised $42 million from Edison International, Kleiner Perkins Caufield & Byers, Google Ventures, Claremont Creek Ventures, Clean Pacific Ventures, Sand Hill Angels, Hennessey Capital, Duke Energy, and others.

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Solexel raised $14.8 million, followed by Tigo Energy which raised $13 million from Alon Ventures. Scifiniti raised $10 million from Alloy Ventures, Firelake Capital Management, I2BF Global Ventures and Peninsula Ventures.

Solar lease (third party finance) companies raised $1.33 billion (B) in disclosed residential and commercial solar project funds this quarter.

Solar M&A activity in Q2 2013 amounted to $1.27 billion in 18 transactions. Themes emerging out of this quarter's M&A activity included: consolidation in the inverter market, strategic acquisitions, and acquisitions of distressed assets/companies. The largest disclosed M&A transaction by dollar amount in Q2 2013 was ABB's acquisition of inverter company, Power-One, for approximately $1 billion.

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Announced large-scale project funding in Q2 2013 came in at $2.94 billion. Solar Star Funding, the wholly owned subsidiary of Warren Buffet's MidAmerican Energy, completed a $1 billion bond offering this quarter, the largest solar bond financing deal to date.

There were more than 670 MW of disclosed projects that changed hands in Q2 2013.

Loans, credit facilities and other types of debt agreements from Chinese banks now stand at about $53 billion.

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