GE, ABB in ‘Arms Race’ Over Clean Energy, Chrysalix CEO Says
Siemens AG (SIE), ABB Ltd. (ABBN), General Electric Co. (GE) and Mitsubishi Corp. (8058) are among the Fortune 500 (FFX) companies competing over clean energy investments, and there will be more acquisitions as the industry matures, according to Chrysalix Energy Venture Capital.
They “have really realized that cleantech now is becoming accretive to their bottom line,” Wal Van Lierop, chief executive officer of Vancouver-based Chrysalix, said in a telephone interview. “That has resulted in an arms race for the best cleantech opportunities.”
Venture and private equity investments globally in clean energy totaled $8.9 billion in 2011, an increase of 4 percent from a year earlier, according to Bloomberg New Energy Finance. Chrysalix tied with Kleiner Perkins Caufield & Byers for the most venture deals done, with 16, data from the London-based research group show.
Companies are showing more interest in early-stage investments to get “access to the deal flow of the future, providing them with a window on new opportunities for their core business,” Van Lierop said. Chrysalix recently received unsolicited investments from three multinational companies consistent with that strategy, he said.
The company today said that Royal Dutch Shell Plc (RDSA), Saudi Basic Industries Corp. (SABIC), and “a large European industrial group” invested in its third fund, according to a statement. The fund originally closed in 2009 with $122 million in proceeds and was reopened to accommodate the new investors, according to Van Lierop, who wouldn’t say how much the three companies contributed.
Waste and Water
Existing backers include Total SA (FP), Essent NV, Fortum OYJ (FUM1V), Kuwait Petroleum Corp. and Credit Suisse Group AG (CSGN), Van Lierop said. New investments will target companies developing waste-to- energy, energy efficiency and wastewater treatment technologies, including processes to clean up traditional hydrocarbon industries, he said.
Chrysalix already backs Agilyx Corp., which converts waste plastic into synthetic crude oil, and GlassPoint Solar Inc., a producer of solar-generated steam for enhanced oil recovery. Agilyx may register for an initial share sale later this year, Van Lierop said.
Chrysalix, whose portfolio company Epyon BV was sold to ABB last year, also expects more clean energy acquisitions.
“We see the very large companies picking up the most attractive cleantech companies,” Van Lierop said. “They become part of their core business, and they become invisible, but it actually means that cleantech is becoming successful where it needs to become successful. Cleantech ten years from now will just stand for the way in which we do business.”
To contact the reporter on this story: Andrew Herndon in San Francisco at aherndon2@bloomberg.net
To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net
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