The majority of German solar suppliers questioned are expecting a period of consolidation for the industry over the next two years. More than 40% of companies are playing a passive role – they are not actively planning acquisitions or mergers or preparing for corresponding talks. This passive behaviour could reinforce German technology being sold off to other countries, thus endangers German solar equipment companies´ leading position on the global market.
“Foreign investors in particular believe that this process offers an opportunity to acquire German expertise,” commented Dr. Helmut Vorndran, a Managing Partner with Ventizz Private Equity, on the results of this study. “That means that the solar equipment sector could see a repeat of the trends in other industries, such as tooling machine manufacturers: The centres of competence are increasingly migrating from Germany to China or South Korea. That means that another German domain – solar equipment suppliers – could find itself in a dangerous situation.”
Suppliers in the industry are forecasting strong growth, in particular for thin-film technology and crystalline solar modules. At the end of the first quarter of 2010, the majority of participants in the study are reporting what is, in some cases, a significant year-on-year increase in order intake.
Migration of production facilities foreseeable
At the same time, there is a clear trend to moving sales and production from Germany and Europe to Asia in particular, and to a lesser extent also to North America. One in three companies identifies financing as being an obstacle to the forecast expansion and on-track growth – experts across the board name a high equity ratio as being a key characteristic for the future.
However, the majority of the industry takes a sceptical view of private equity companies, who also come into question as investors in addition to the capital market. “In order for a solar supplier to be able to consider cooperating with a private equity investor, the investor must, in particular, understand the industry, have a strong network and sufficient funds for subsequent financing,” summarized Dr. Vorndran.
In total, decision-makers at 22 select solar suppliers in Germany participated in the survey of experts. It was conducted online from 22 March to 11 May 2010, by Wiesbaden Business School, under the leadership of the private equity expert Prof. Stefan Jugel.
A full evaluation of the survey can be downloaded from:
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