Mercom Capital Group, llc, a global clean energy communications and consulting firm, released its report on funding and mergers and acquisitions (M&A) activity for the Smart Grid, Battery/Storage and Energy Efficiency sectors for 2015.
Venture capital (VC) funding (including private equity and corporate venture capital) for Smart Grid companies increased slightly to $425 million in 57 deals, compared to $384 million in 74 deals in 2014. Total corporate funding, including debt and public market financing, equaled $527 million, compared to $844 million in 2014.The Top VC funded company in 2015 was SIGFOX, bringing in $115 million. Actility brought in $25 million followed by PubNub with $20 million, Smart Wires with $17.3 million and Bit Stew Systems with $17.2 million.
There were 103 VC investors in the Smart Grid category in 2015 compared to 88 in 2014. Top VC investors this year included GE Ventures, Bpi France, E.ON, EnerTech Capital, Idinvest Partners, Khosla Ventures and Maryland Venture Fund. Smart Grid Communications companies, including Home and Building Automation technology companies, attracted the largest share of VC funding this year with $183 million in 16 deals, followed by Data Analytics companies with $63 million in 11 deals. There were two debt and public market financing deals announced in 2015, totaling $102 million. The only IPO this year was the $98 million raised by Alarm.com.
There were 20 Smart Grid M&A transactions (10 disclosed) for $5.3 billion. The top disclosed transaction was Honeywell’s $5.1 billion acquisition of the Elster Division of Melrose Industries. Other transactions included the acquisition of AlertMe by British Gas (part of the Centrica plc group) for $100 million, Silicon Labs’ acquisitions of Bluegiga Technologies for $61 million and Telegesis for $20 million, and IXYS’ acquisition of RadioPulse for $22.5 million. EnerNOC, ABB, Schneider Electric, GE and Seimens have led the M&A activity in the sector since 2010.
Battery/Storage companies brought in $397 million in 37 deals compared to $431 million in 34 deals in 2014. Total corporate funding, including debt and public market financing, came to $676 million, compared to $921 million in 2014. Flow Battery companies received the most funding with $120 million followed by Energy Storage System companies with $96 million.The top VC funded companies included VionX Energy which raised $58.1 million, Younicos with $50 million, Stem which brought in $33 million, and Primus Power and UniEnergy Technologies each raising $25 million.There was a total of 57 VC investors who participated in Battery/Storage deals in 2015. Three investors were involved in multiple deals including AltEnergy, DBL Partners and Pangaea Ventures with two deals each.
Debt and public market financing for Battery/Storage companies fell to $279 million from the $490 million raised in 2014. There was one IPO this year, the $15.6 million raised by Electro Power Systems. FuelCell Energy announced a project finance fund of $30 million.There were 11 M&A transactions in Battery/Storage, of which four transactions were disclosed, totaling $2.4 billion compared to 18 M&A transactions (six disclosed) in 2014 for $232 million. The most prominent transaction was the $2.2 billion acquisition of Polypore International’s energy storage business by Asahi Kasei.
VC funding for the Energy Efficiency sector increased to $852 million in 67 deals compared to $797 million in 80 deals in 2014. Total corporate funding, including debt and public market financing, was over $2 billion, compared to $1.2 billion in 2014.The top VC funded companies were View (formerly Soladigm), which raised $150 million, followed by Verne Global with $98 million. Renovate America raised $90 million, Transphorm had a $70 million raise and Clean Fund brought in $60 million.Lighting technology companies captured the most funding with $187 million in 23 deals. A total of 123 investors participated in funding deals; six of them were involved in multiple deals. BDC Entrepreneurs First, CEA Investissement, E.ON, GE Ventures, Kleiner Perkins Caufield & Byers and Rockport Capital had two deals each.
Energy Efficiency companies also raised nearly $1.2 billion in debt and public market financing. There were five securitization deals this year in the sector for $801 million. Since 2014, securitization deals in Energy Efficiency have now exceeded $1 billion in seven deals. There were two IPOs raising a combined $168 million; MLS raised $154 million and BuildingIQ raised $14 million.There was almost a two-fold increase in M&A activity in the efficiency sector this year with 45 transactions, 22 of which disclosed amounts. In 2014, there were 26 M&A transactions, of which only 10 disclosed transaction amounts.
The largest disclosed transaction was the $2.8 billion acquisition of an 80.1 percent interest in Lumileds by GO Scale Capital Investment Consortium.
With increased consolidation activity, Lighting companies were the most active this year with 19 transactions compared to 11 in 2014. The top four M&A transactions in the sector this year involved Lighting companies.