First published in Cleantech Infocus: 2010 - Equity Deals of the Year, January 2011. Copyright Cleantech Investor Ltd.
Equity fund raising for wind technology companies on public markets reflected the broader state of the wind energy industry during 2010. The major global trends were a boom in Chinese wind and a slowdown in US wind. Mirroring this, the Chinese were the most successful in terms of wind equipment manufacturers seeking to raise funding on public markets during the year.
China’s largest turbine manufacturer, Sinovel Wind, was forced to push its planned IPO into 2011 – Sinovel has subsequently raised RML 9.5 billion, or $1.4 billion, in the first week of January – but the number two manufacturer in China, Xinjiang Goldwind, was successful in raising US$916 million in October 2010 in conjunction with a listing on the Hong Kong market. Goldwind, which was already quoted on the Shenzhen exchange, had been forced by the difficult market conditions to postpone its planned listing several times previously.
Fellow Chinese turbine manufacturer, China Ming Yang Wind Power Group, listed on the NYSE in October, raising US$350 million. And Chinese wind tower manufacturer, CleanTech Innovations, was listed on NASDAQ in December – in sharp contrast to the fortunes of Danish tower manufacturer, Skykon, which failed to raise rescue finance during 2010 and ultimately was forced into administration at the beginning of 2011.
The cancellation of the planned IPO of First Wind Holdings in the US (see renewable energy generation deals) had repercussions for Clipper Windpower, a major supplier to First Wind. Clipper, which had been listed on the London Stock Exchange’s AIM market, was taken private by principal shareholder United Technologies – at a discount to the price United Technologies had paid for its initial investment.
Meanwhile, in Latin America, the planned IPO of IMPSA (an Argentinian turbine manufacturer which has the majority of its manufacturing in Brazil) on the Sao Paulo Bourse was postponed.
In terms of venture capital investment, there were several notable deals for companies developing technologies for more efficient large scale offshore wind turbines. These included ChapDrive of Norway (which is developing a hydraulic transmission with variable speed control) and Scotland’s NGenTec (focused on direct drive technology).
Xinjiang Goldwind Science & Technology Co. Ltd
IPO – Hong Kong
Chinese wind turbine manufacturer, Xinjiang Goldwind Science & Technology, listed in Hong Kong with an IPO priced at HK$17.98 a share in October. The deal raised US$916 million. Goldwind, China’s second largest wind turbine manufacturer after Sinovel, is expanding outside its domestic market and has entered the US market.
China Ming Yang Wind Power Group Ltd
IPO - NYSE
Ming Yang Wind Power, a Chinese wind turbine manufacturer, listed on the NYSE in October, raising US$350 million through the sale of 25 million ADRs at a price of US$14 per share. The company produces turbines based on intellectual property developed jointly with German turbine design firm aerodyn Energiesysteme. Ming Yang’s customers include China’s five largest state-owned power producers.
CleanTech Innovations Inc.
IPO – NASDAQ
Shares in CleanTech Innovations, a US company which operates predominantly in China, were listed on NASDAQ in December. CleanTech Innovations produces wind turbine towers, bellows expansion joints and pressure vessels for the wind energy industry (and others including steel, coking, petrochemical, high voltage electricity transmission and thermoelectric industries). Customers include China Guodian and HuaNeng Energy. CleanTech Innovations’ shares had previously traded on the OTC Bulletin Board.
ChapDrive AS
Venture Capital Fund Raising
ChapDrive of Norway received funding of NOK86 million in the first half of 2010 from investors including Viking Venture and Investinor. ChapDrive is building a concept design with Statoil which is expected to become a working prototype in 2012. The technology is for 5MW wind turbines with hydraulic transmission with a variable speed control system, based on research from the Norwegian University of Science and Technology. It eliminates a mechanical gearbox and frequency converters, and moves critical components down to the foundation, reducing the top weight.
NGenTec Limited
Venture Capital Fund Raising
The Scottish Co-investment Fund and SET Venture Partners joined forces in December to invest £2 million in NGenTec, a spin-out of the University of Edinburgh, which is developing novel direct drive generator technology for offshore wind. The NGenTec ‘C-GEN’ solution is lightweight and eliminates magnetic forces between the moving and stationary parts of the turbine. NGenTec plans to demonstrate a 1MW generator, but ultimately expects to prove its generator technology at a scale of 6MW.
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