Total Buys Majority Stake in SunPower
The solar power industry is consolidating. In fact, this quarter has seen several mergers and acquisitions in the energy arena, across various forms of energy generation. French Oil and gas company Total is buying 60 percent of U.S. based SunPower, one of the largest solar panel and power plant developers in the United States.
The deal is part of a continuing trend, especially in the wind and solar sectors, of independent companies seeking aid from large multinationals in order to compete with low-cost Chinese competition.
Total is paying $23.25 per share of SunPower’s class A and class B shares. This marks a 49 percent premium over closing price Wednesday. The deal values SunPower’s equity at $2.3 billion.
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“Total’s commitment and global presence will help accelerate our growth and solidify our position in the increasingly competitive solar sector,” says SunPower CEO Tom Werner.
“With Total’s $1 billion credit support agreement, solar research and development investments and the other resources available through its global network, we have taken the next step in positioning our business for continued growth and long-term success,” he added. “Our relationship with Total will improve our capital structure enabling SunPower to accelerate our power plant and commercial development businesses, and expand our manufacturing capacity with lower cash requirements.”
First Solar will now take the reigns from SunPower as the largest independent U.S. solar panel developer.