Global investor KKR has acquired a majority stake in US-based solar and energy storage developer Avantus.
KKR and existing investor EIG now own the entirety of Avantus between them, and have secured over US$1 billion in development financing for Avantus’ future growth. The company said that its current project pipeline consists of 30GWp of solar PV and 94GWh of battery energy storage system (BESS) projects. To date it has developed and sold 6.5GWp of solar and 6.3GWh of BESS projects.
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Following the closure of the transaction, Avantus said that it will establish an “equity ownership programme” with KKR’s support, “to provide all employees the opportunity to participate in the benefits of ownership of the company”.
Charlie Gailliot, partner and co-head of global climate strategy at KKR said: “To support an economy-wide energy transition, there is a need to significantly expand renewable energy generation by 2050 and enable grid electrification. Because of these tailwinds, we see enormous opportunity for Avantus.”
Patrick Goff, CFO at Avantus added: “Solar is the fastest growing electricity source in the US, and along with energy storage, will serve as the backbone of a modern electric grid that is clean, reliable and resilient. KKR’s investment provides Avantus the financial backing and expertise to execute on our ambitious portfolio and lead the energy transition across the western United States.”
This acquisition follows the general trend of increased private investment into the solar industry. Solar PV was the dominant source of new renewable electricity capacity in the US last year, sending strong signals to the industry and financiers about the profitability of the technology.
Simultaneously, corporate financing into the solar sector rose by around 40% year-on-year (YoY) in 2023, according to data from Mercom Capital, hitting US$34 billion for the year. However, Mercom found that the number of mergers and acquisitions, such as this KKR deal, declined by 25% YoY.
KKR said that it has invested over US$15 billion in renewable energy and climate-related ventures to date. In March 2023, it sold its stake in Spanish renewable energy developer X-Elio to Canadian asset manager Brookfield Renewable,