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12 August 2013

TVP Solar seeks to raise up to EUR 20M through share sale and JVs

From: Mergermarket

12 Aug 2013, by Riccardo Ghia

TVP Solar, a private Swiss developer and manufacturer of high-vacuum flat solar thermal panels, is looking to raise up to EUR 20m, CEO Piero Abbate said. EUR 5m will secure a minority stake in the holding, while EUR 15m will be invested in joint ventures in Brazil and China.

Last month, the company announced a CHF 6.6m (EUR 5.4m) second closing of its series B round. Major investors include existing shareholders in the oil and gas sector; as well as new investors Ghazel Real Estate, of Kuwait, and Industrie Abate, from Italy.

The company will seek a further series B extension of up to EUR 5m over the next 16 months and is looking for one or two strategic investors. There will also be the opportunity for such new investors to replace some minority shareholders, who would exit through the sale of 15%-20% stakes for an extra EUR 5m.

TVP Solar has attracted interest from Brazilian and Saudi strategic players operating in the oil and gas sector, Abbate said. He noted that the company developed HT-Power solar panels that can warm water up to 250 ÌŠC -- compared to 40 ÌŠC for regular solar panels, which can only be used for sanitary hot water.

HT-Power has potential applications in enhanced oil recovery (EOR) techniques to increase the amount of crude oil that can be extracted from an oil field, including steam flood and water flood injection and hydraulic fracturing. TVP products can also be used for air conditioning and industrial process heat applications, Abbate said. Its core business is supplying 300-sqm to 3,000-sqm panels for commercial and industrial applications, whereas current solar thermal panel manufacturers focus on residential applications.

Brazilian JV

TVP Solar plans to attract further investments through JVs with strategic partners in Brazil and China to set up local production units.

In Brazil, the company is looking for a potential strategic partner which would hold a minority stake and invest between EUR 3.5m and EUR 5m out of EUR15m total investment (capex and working capital). 

Abbate noted that TVP Solar has also entered talks with the local government of Rio De Janeiro to co-finance the project. The plant is expected to kick off operations by December 2015 with annual production capacity of 150,000 sqm of solar panels. 

Chinese JV

TVP Solar has entered JV talks with major Chinese solar thermal panel manufacturers. The company aims to set up a plant with annual production capacity of 300,000 sq m of solar panels by 2016 and to double that by 2020. TVP Solar would hold a minority stake in the JV, Abbate said, while the majority partner would invest up to EUR 10m.

Ideal JV partners would be the largest solar thermal panel manufacturers with established sales channels. Abbate noted that China is the world's largest solar thermal panel market, accounting for the production of 50m sq m of solar panels out of global production of 66m sq m in 2012.

The largest producers of solar thermal panels are also Chinese. Jiangsu’s Sunrain New Energy Group, Shandong’s Linuo Solar Energy Group and Beijing’s Tsinghua Solar are the world’s largest manufacturers with annual production between 2.5m sqm to 4m sqm in panels, up to 10x more than their closest European competitor, Bosch. The improved efficiency of TVP Solar panels could find interesting applications for ambient heating in China, the solar radiation from which tends to be lower.