Refusol acquisition critical to long-term success, says Advanced Energy’s solar chief

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A top executive from Advanced Energy Industries today admitted the company would have risked relegation to the second tier of inverter companies without its recent acquisition of Refusol, a leading European inverter manufacturer.

Gordon Tredger, president of solar energy at the Oregon-based thin film and PV inverter company, told PV-Tech that despite a strong presence in the US, its global presence thanks to Refusol was critical to long-term success.

“We had customers that were looking at us as potentially a second tier supplier because we weren't able to deal with them on a global basis. In a globalising industry like solar where EPCs are looking at markets in South Africa and India, you have to be able to deal with that customer wherever they go. The acquisition was a way of accelerating our progress.”

Last month AEI announced its $76.6m acquisition of Refusol, one of Europe's top three inverter companies that had seen growth of around 150% over the past three years. Two weeks later, ABB acquired Power-One and SMA acquired a majority stake in Zeversolar.

Refusol's three-phase inverter for rooftop and commercial applications would complement AEI's existing central inverters for utility-scale projects, said Tredger. AEI's 1000NX inverter for utility applications will ship from this quarter.

AEI regards the acquisition as central to the company's growth and target revenues of $400m in 2014. The company recently reported modest growth in revenues in the last quarter with an operating income of $6.8 million, up $1.9 million from the last quarter of 2012.

Tredger said AEI had now positioned itself as one of the top three inverter companies globally alongside ABB & SMA as the sector appears to undergo consolidation.

“I've been saying for some time that there's going to be some consolidation in the inverter space. It was a logical conclusion when you look at the market. There were a couple of clear leaders and there were about 15 companies in a dead heat with 2-4% global share.

“We do see ourselves as one of the leaders for providing solutions for these applications and to use AE in the same breath as those two companies, we think that's a natural comparison to make. We've got a very aggressive timetable to make sure that we unify the businesses, strengthen ourselves.”

A report released last week by IMS Research, part of IHS, showed rankings for Advanced Energy and Enphase in the US market at fourth and sixth, respectively, in 2012 – up from eighth and 11th in 2011. While SMA Solar Technology’s dominant position in the PV inverter industry slid further in 2012, when its share fell to slightly more than 25%, having stood at nearly 40 percent in 2009.

But rather than consolidation after acquisitions and bankruptcies, such as Satconn last year, the market share of the 10 largest PV inverter suppliers fell from 62% in 2011, to 56% in 2012, suggesting continued fragmentation in the market, the report found.

Tredger did not rule out further acquisitions. “I wouldn't say we've stopped acquiring,” he said. “If there's a particular aspect of monitoring, storage solution we would be open to looking at other things that would diversify us to become a broader solution provider.”

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