A major new report analyzing mergers and acquisitions (M&A) and financing deals across the clean tech sector in 2009 has come to the conclusion that despite the economic downturn, investment rose in 2009.
Some areas, like venture capital investment fell, but overall there was a 32% increase with clean tech investment hitting $381 billion last year.
GlobalData, the analyst firm that created the report, found that the investment increase was largely due to government support and especially China’s big clean tech push.
Th report, Clean Technology Annual Deals Analysis 2010, found that investments in Asia Pacific and Europe increased 126% and 52%, respectively, in 2009.
North America took a harder hit from the recession. Clean tech investments barely rose from $141 billion in 2008 to $145 billion in 2009 there.
Due to the global credit crunch, GlobalData found that small and medium sized businesses were involved in a lot of mergers and acquisitions in 2009. “Small and medium sized clean tech companies struggled to stay afloat during 2009 due to tight financing options caused by credit crunch,” GlobalData analyst Arun Kumar C said. “Government owned power utilities in an effort to diversify the energy mix acquired clean energy companies the world over which also bumped up M&A Investments.”
Private sector investment really dropped across the board in 2009 as a result of the economic situation.
[W]hile overall investments defied the downturn, venture capital f inancing for clean technology companies slumped dramatically from $8.8bn in 2008 to $3.4bn in 2009. The number of venture capital deals also decreased from 373 deals in 2008 to 236 deals in 2009, as venture capitalists shied away from investing in potentially risky start ups.
In addition, private equity financing decreased drastically from $19bn in 2008 to just $3.6bn in 2009, again mirroring the global financial meltdown. The Quercus Trust topped the PE financing table, by participating in 10 transactions for deal value worth $44.3m in 2009.
However, this was offset (more so) by things like debt offerings and equity offerings, such as initial public offerings (IPOs), secondary offerings, and private placements.
Clean tech clearly survived 2009. However, I think we can expect much more from the sector in 2010.
Image Credit: TW Collins via flickr/CC license
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