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Cleantech Group Reports Cleantech Investments Up 42 Percent in 1Q08 From Prior Year, Despite Recent Peak of Ethanol, Wind and Thin Film Solar Waves
Long-term trend remains positive, even in face of second sequential quarter decline
SAN FRANCISCO, April 9, 2008 - The Cleantech Group(TM), founders of the cleantech investment category and providers of leading global market research, released today 1Q08 results for cleantech investments in North America, Europe and Israel totaling $1.25 billion, up 42 percent from the same period a year ago.
1Q08 represents the second consecutive quarterly decline since the record third quarter of 2007, yet is an all-time record for a first quarter period in the cleantech category, and also the first time a first quarter has exceeded the $1 billion mark.
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Cleantech Group recorded 79 transactions in 1Q08, averaging $15.8 million per round, up 53 percent from the $10.3 million average a year ago. The increase represents the 4th consecutive quarter of double-digit growth on a year-over-year basis. On a sequential basis, the $1.25 billion invested in 1Q08 was down 20 percent from what was a very strong 4Q07, reflecting possible seasonality in the sector.
"While the long-term investment trend shows continued expansion of the category as a whole, we are seeing contraction in what had been the market-leading sectors of first generation biofuels and second generation solar," said John Balbach, Managing Partner, Cleantech Group. "This healthy minor correction indicates exuberance is giving way to tempered optimism."
Cleantech Group's data suggests two high profile investment waves have peaked:
-- ETHANOL AND WIND (2005-2006): Powered by investments in US
ethanol and
European wind energy companies, the wave peaked in 3Q06 at
$1.52 billion and has steadily declined since.
-- THIN FILM SOLAR (2007): Driven
by investments in US and European
thin-film solar companies, this wave peaked in 3Q07 at $1.83
billion
invested, and has since contracted for two consecutive
quarters, to
$1.56 billion 4Q07 and $1.25 billion in 1Q08. Thin-film
technologies
accounted for approximately two-thirds of investments in
solar, while
crystalline technologies accounted for one-third.
Top Five Global Venture Investors
(by number of participations):
Company
Deals Amount $(mil)
Khosla Ventures 9 deals,
including 3
undisclosed
deals 205
New Enterprise
Associates 4 deals, total of the
rounds 84.4
Kleiner Perkins
Caufield 4 deals, including 1
& Byers undisclosed
deal 80
Element Partners 4 deals, total of the
rounds 68.9
Israel Cleantech
Ventures 4 deals, total of the
rounds 16.6
Source: Cleantech Group, LLC (TM)
North America
In North America, $873 million was
invested in 50 companies. North American cleantech investing
increased by 35 percent year-over-year, up from 20 percent growth
between 1Q07 and 1Q06. Investment in 1Q08 was lower than the
record-breaking 3Q07 and 4Q07, while average deal size has continued
to increase for six straight quarters.
Top Five North American Investments (by round size)
Company State
Type Amount $(mil)
Range Fuels Colorado
Thermochemical
cellulosic
ethanol $100
Luminus Massachusetts Solid state
lighting $72
Infinia Washington Stirling
engines $50
Suniva Georgia Crystalline silicon
solar cell
production $50
Boston Power Massachusetts Li-ion
batteries $45
Source: Cleantech Group, LLC (TM)
Top Five North American Sectors
Sector
Category Amount $(mil) Number of Deals
Biofuels Energy
Generation $195 5
Solar Energy Generation
$119 8
LED lighting Energy Efficiency
$100 5
Materials Materials
$96 3
Li-ion Batteries Energy Storage
$58 3
Source: Cleantech Group, LLC (TM)
Energy-related cleantech (energy
generation, storage, efficiency and infrastructure) in North America
received $678 million, 77.6 percent of the investment total, across
37 companies. Energy has represented at least two-thirds the number
of North American cleantech deals for the last eight quarters.
Top Five North American Regions
Region Category
Amount $(mil) Number of Companies
West Coast (CA)
$282 30
Northeast (MA,PA,VT, DC)
$223 15
Rockies/Plains (CO)
$113 3
Southeast (GA,VA,FL)
$9 4
Northwest (WA)
$67M 2
Source: Cleantech Group, LLC (TM)
Both Silicon Valley and Canada exhibited
seasonal dips, with relatively low $116 million and $43 million
invested respectively. California accounted for 32.3 percent of
total investments, compared to the previous six quarters of at least
40 percent. The Boston tech cluster hit a high mark of $165 million
invested.
Europe & Israel
European and Israeli cleantech companies
received USD $377 million in 29 transactions. The quarter was up
63.8 percent year-over-year, a record first quarter, and up 4
percent quarter-over-quarter. The top five investments accounted for
75 percent of the total, including three solar companies in Israel
and Germany, one wave energy company in the UK, and one materials
company in Sweden. Excluding Israel, European cleantech companies
raised $245 million, representing a lowered 7 percent growth versus
a year ago.
Western Europe, including the UK, was
tracked at $217 million invested in 18 transactions. Israel had a
breakout quarter with $132 million across nine companies, the
highest ever for the country, driven mainly by a $105 million
investment in solar thermal concentrator company Solel Solar
Systems. This is a 75 percent increase from the previous quarter.
Energy Generation continues to dominate European cleantech
investing, accounting for 80 percent of the $377 million total, and
up 75 percent from 4Q07.
M&A and IPOs
Cleantech M&A amounted to 47
transactions completed in 1Q08, up from 39 in 1Q07, but less
activity versus the previous three quarters. Airtricity was the top
acquisition, valuing the wind farm company at approximately $2.1B.
Over half of M&As were in energy generation. Cleantech IPOs hit an
all-time low with four recorded, the largest being Shenzhen Topray
Solar listing on the Shenzhen Stock Exchange generating $60M.
Cleantech Index (CTIUS) Performed Well
Despite Current Economic Conditions
The Cleantech Index (CTIUS), composed of
46 companies with a combined market capitalization of approximately
$340 billion, was not immune from downward pressures on public
equities. Despite sliding 13.6 percent in 1Q08, CTIUS outperformed
the NASDAQ Composite Index (down 14.1 percent) and outperformed
nearly all the alternative energy indices, which fell in the 18-30
percent range. The S&P 500 was down 9.9 percent and the Russell 2000
Index fell 10.2 percent.
About Cleantech Group, LLC
The Cleantech Group, LLC provides insight, opportunities and builds relationships that catalyze and accelerate market adoption and commercialization of clean technologies globally. The Cleantech Group founded the cleantech investment category and through its membership services brings together investors, executives, thought leaders, policy makers, and entrepreneurs to facilitate the growth of cleantech globally. Visit http://www.cleantech.com .
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Source: The Cleantech Group
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