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Germany continues to hold the fort in Europe and is still concentrating investors’ minds amid Eurozone crisis that is plaguing the continent, according to the recently released report by KPMG- ‘Green Power: 2012.’
The report says that for the second year running Germany is the most frequently targeted European country for renewable energy acquisitions and investment. Around 21 per cent of corporate and investor respondents worldwide, who took part in the survey conducted by KPMG, plan to target Germany over the next 18 months.
The Eurozone was inevitably the centre of attention, given the perilous state of many public sector finances in the region, and hence their borrowing requirements. The global financial crisis had an impact on the renewable energy industry, and on renewable energy M&A during 2011.
However, despite the crisis and a series of subsidy cuts in recent months, Germany was able to communicate to the market in a highly transparent manner. As a result Merger & Acquisition (M&A) activity has remained buoyant – some 64 M&A deals totalling US$3.7bn were announced in 2011, compared with 79 deals totalling US$3.6bn in 2010.
The report predicts that Eurozone crisis will definitely have a bearing on future M&A activity, with different markets subjected to different issues. It says that Greece will likely remain in the doldrums, Spain too will not be spared because of uncertainty of retroactive changes to existing subsidies. However, in Italy, medium term M&A activity may be buoyant in the solar PV sector at least, whereas Germany and other Northern European countries perceived as relative safe havens.
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