Coronavirus deal slump sees cleantech PE, VC investment fall to lowest value since September 2016

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Private equity and venture capital investment targeting cleantech companies sunk to its lowest total since September 2016 last month, as the growing coronavirus crisis put the brakes on significant dealmaking.

Although deal volume recovered from poor February and March totals to a more respectable 30 deals, investment dollars into the sector slumped amid a distinct lack of larger deals, data from Moody’s Analytics subsidiary BvD shows.

The $383m of PE and VC investment was, on paper, a staggering slump from the previous month’s $5.7bn – but March’s figures were boosted by a single large deal, with KKR agreeing to acquire the Viridor recycling business of UK water utility and waste manager Pennon for about $5.3bn.

Just a single deal worth more than $100m was recorded in April, with KKR agreeing to buy Shapoorji Pallonji Infrastructure Capital’s India-based solar energy assets for $204m.

The second-biggest deal involved M&G Investment Management agreeing to pick up a 63% stake in Norway-based electric vehicle charging stations operator Fortum Recharge for $95m.

PE and VC investors targeting the cleantech sector in April also included Jiangsu Xinhua Fengyu Capital Management, Esplanade HealthTech Ventures, Simbon Investment Partners and SK Ventures, BvD said.

In wider M&A, the largest cleantech deal in April saw Chinese wind turbine motor manufacturer Mingyang Smart Energy Group agree to raise $849m through a private placing of stock, representing a 23%.

That deal accounted for 14% total cleantech M&A value for April. The second-biggest deal also took the form of a private placing, as China-based power module manufacturer JA Solar Technology announced plans to raise $739m.

Cleantech companies based in China were targeted in six of the month’s top 20 deals, BvD said.

Other countries targeted during the four weeks under review included Spain, Portugal, India and Norway.

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