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Buyout Activity Heats Up In Renewable Energy Industry

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KKR

One sign of an expanding industry is when it starts getting engulfed with a rapid series of acquisitions. That’s been happening in the renewable energy industry, which has seen a recent spate of deals in the United States and abroad.

Four major deals were announced in the spring, with a value of more than $5 billion. Two of the deals involved French oil and gas company TotalEnergies. Another buyout was made by New York-based private equity firm KKR, which has invested about $4 billion into renewable assets over the last decade.

KKR made the first move on April 28 when it announced the acquisition of Albioma, a Paris-based renewable energy production company specializing in biomass, photovoltaics, and geothermal energy. The deal valued Albioma at more than $1.7 billion.

Photo Courtesy KKR

Albioma has more than 1 gigawatt installed capacity, including 14 power plants in France, Mauritius, and Brazil. The company partners with the sugar industry to produce renewable power from bagasse, a fibrous residue found in sugar cane. Albioma is also a leading generator of photovoltaic energy overseas.

The Albioma buyout represents the latest in a series of renewable energy moves by KKR, including this year’s launch of Aster Renewable Energy, a renewable energy investment platform in Asia. In December 2021, KKR launched Stellar Renewable Power, a platform that aims to originate long-duration high-yielding solar energy investments.

Another mover and shaker in renewable energy, TotalEnergies, announced the acquisition of Austin, Texas-based solar energy company Core Solar. The deal expands TotalEnergies’ presence in the U.S. by adding a 4GW solar and storage portfolio, bringing the company’s pipeline of U.S. renewable projects to 10GW.

At the time of the buyout, Core Solar had projects in Florida and North Carolina, as well as a multistate pipeline project in the Midwest and South. CEO Greg Nelson will join the TotalEnergies team, along with Core Solar’s staff of site evaluation, real estate procurement, community engagement, permitting, environmental analysis, engineering, tax agreements, and grid interconnection experts.

TotalEnergies continued its U.S. buying spree on May 25, when it agreed to acquire a 50% stake in Clearway Energy Group from Global Infrastructure Partners (GIP) for $1.6 billion. Under terms of the deal, GIP will get an interest of 50% minus one share in a TotalEnergies’ subsidiary that owns a 50.6% stake in SunPower.

Photo Courtesy KKR

Clearway, headquartered in San Francisco, develops renewable energy projects. It has 7.7 GW of wind and solar capacity through a 42% economic stake in its listed subsidiary, Clearway Energy (CWEN). Clearway also has a 25 GW pipeline of renewable and storage projects, 15 GW of which is in advanced stages of development.

“This transaction perfectly fits with our strategy to make renewable electricity one of our main growth drivers,” TotalEnergies CEO Patrick Pouyanné said. “It illustrates our priority to accelerate the transformation of the company to become a sustainable and profitable multi-energy company.”

Meanwhile, Global Infrastructure Partners, a New York-based infrastructure investment fund, was involved in another May deal when it announced plans to buy Miami-based clean energy company Atlas Renewable Energy for about $2 billion. The seller was Actis, a private equity firm.

Atlas launched in 2017, develops, builds, and operates solar and wind projects mainly in Latin America. It powers 1.2 GW of contracted projects in construction or operational stages. The deal should help Atlas expand its operation in the region, Bloomberg reported.

Photo Courtesy KKR
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