OSLO (Reuters) - Norwegian solar firm Scatec Solar SCAA.OL said on Friday it had agreed to buy state-owned hydropower firm SN Power in a $1.17 billion deal as it transforms itself into a global renewables company.
Shares in Scatec Solar were up 25.7% by 0743 GMT.
The combined company would have 450 employees and own 3.3 gigawatts of in operation and under construction power plant capacity in 14 countries, and annual production of 4.1 terawatthours (TWh), Scatec Solar said in a statement.
Scatec owns and runs solar farms in Africa, Asia, Europe and Latin America, while SN Power builds and operates dams in southeast Asia and Africa.
“Hydropower and solar PV (photovoltaics) are complementary technologies, resulting in new project opportunities, for instance floating solar on hydro reservoirs,” Scatec Solar CEO Raymond Carlsen said.
The deal would also help Scatec Solar expand in growth markets for renewable energies such as sub-Saharan Africa and southeast Asia, Carlsen said.
The firm it planned to further branch out into wind and electricity storage.
While many traditional utilities have announced deals to expand into green power assets to cut greenhouse gas emissions, the latest acquisition is one of only a few M&A deals between renewables firms.
“We strongly support the transition from harmful coal towards clean solar and wind energy globally,” Eric Pedersen, head of responsible investments at Nordea Asset Management, said of the deal on Friday.
Scatec Solar is buying 100% of the shares in SN Power, owned by Norfund, an investment fund for developing countries owned by the Norwegian state, for a total equity value of about $1.17 billion.
“Today, we are witnessing an excellent example of how smart, green and sustainable investments in developing countries can be profitable and thus help with both solving the climate crisis and reducing poverty,” Norwegian minister for international development Dag-Inge Ulstein said in a statement.
The government would reinvest the capital into new projects, he added.
Editing by Rashmi Aich and Jason Neely and Kirsten Donovan
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