Over the years, M&A activity in Australia has seen some fairly substantial purchases, but with this announcement valued at 25.5 million, it sets an exciting new record for solar business sales value in the land down under.
The founders of SolarJuice are two guys I've known for a long time, being former colleagues. The first time I met Andrew Burgess was back in 1998 when he was sitting at a small desk in a dingy office in the back of an even dingier solar panel factory at Sydney's Villawood. This young man had the role of making sure solar panels flowed out to Solarex's dealers in a timely manner and he was a crucial interface between customers, suppliers and the folks running the manufacturing side of the operation.
No doubt the lessons he learned in these early days served him well. He went on to survive the merger with BP Solar and managed an ever growing portfolio of large projects around the country and the world before working with Conergy for a short while in Sydney, then going on to establish SolarJuice.
The second key person is Rami Fedda, the company's co-founder. Rami also learned the ropes at Solarex and then went on to become a key person within BP Solar's manufacturing operations. During my time there, the always quiet but sharp witted Rami diligently and unassumingly beavered away managing ever larger deals to buy silicon and other raw materials, negotiating with suppliers around the world. As time passed, Rami's incredible knowledge of the way the solar supply chain worked and his ability to cunningly negotiate became legendary.
Around 2010, I got a surprise call from Andrew who told me that he and Rami had decided to open a wholesale business. They started small but - with a combination of profound experience, cunning negotiation and awesome timing - they created a solar wholesaler that had the right products at the right time, in the right way and at the right place. By 2013 they had built the business up the point where they were not only the largest wholesaler in Australia in terms of volume, but also shifted more product than any other company - bar none.
Under the terms of the share purchase agreement, SPI will acquire from entities controlled by SolarJuice's shareholders 80% of the outstanding capital stock of SolarJuice for an aggregate consideration of approximately 25.5 million in SPI common stock. This transaction is subject to several customary closing conditions. The founder of Solar Juice will retain seats on the board and an active role in the operations and directions of the company but no doubt there are a load of options and possibilities.
SPI is a fascinating and relatively new company who are clearly in the big time with a market capitalisation around US1 billion and a very healthy share price. They are predominantly an EPC (engineering, procurement and construction) contractor with a growing list of multi-megawatt projects under their belt mostly in China, but are expanding into a growing number of innovative business spaces including financing, asset management, floating solar projects (float-o-voltaics) and e-commerce platforms for energy trading.
While Andrew and Rami will clearly remain involved in SolarJuice, they aren't sitting back on their laurels and have already started on their next venture with the launch of a new business called Opal Solar, which we'll learn more about in coming months and years, I'm sure. To kick off, Opal Solar recently signed as a major sponsor with the Canterbury Bulldogs and is on the way to building a new brand and a new story.
The entrance of such a major player (SPI) into the Australian market, despite the current political and market doldrums is a sign that there's life in the old girl yet. I also have to admit being a little gobsmacked and entirely delighted at the achievements of SolarJuice's founders. Congratulations fellas!
Credit: energy-saving-technologies.blogspot.com
