Cleantech stages Q2 recovery

Cleantech investment has increased by 12% in the second quarter of the year compared to the first after US$1.2bn was invested in 94 companies globally.

This is 44% lower than the same period last year however, according to research house the Cleantech Group.

Brian Fan, senior director of the company, said: “Cleantech venture investment has rebounded moderately after free-falling for two consecutive quarters. We are seeing initial signs of recovery in other cleantech asset classes, including recent activity in solar tax equity, increased M&A levels, as well as billions in government stimulus that are being allocated globally to the cleantech sector over the next several quarters. Additionally, new climate and energy legislation from governments worldwide and the upcoming Copenhagen climate negotiations continue to be strong drivers of investment and innovation.”

M&A activity saw 138 deals in Q2, with the 40 disclosed deals totaling US$12.2bn. There were also two IPOs – China Metal Recycling on the Hong Kong Futures Exchange, which raised US$186m, and Duoyuan Global Water on the NYSE, which raised US$88m.

Of the total venture cleantech investment, 66% went to companies in North America, while Europe and Israel took in 21%, India 11% and China 1%.

Businesses in Europe and Israel raised US$259m in 30 disclosed deals, a 13% drop from Q1 and a 17% decline from Q2 2008.

Energy generation took in the most money, with 11 deals and US$130.5m. The largest deal of the quarter was German biogas plant developer which raised US$81.7m in a funding round led by the European Clean Energy Fund, a €354m fund owned by US investment group TCW. Other investors included UK hedge fund Altima Partners, US renewables investor Green Partners, US alternative asset management Halycon and the UK’s Ludgate Environmental Fund.