RGS Energy (Nasdaq: RGSE) is buying Elemental Energy LLC, which operates as Sunetric, for $16 million.
Oaho, Hawaii-based Sunetric develops and installs solar panels.
RGS, headquartered in Louisville, Colo., provides solar energy services to commercial, residential and utility customers. Sunetric will operate as a unit of RGS.
The deal should allow RGS to enter the Hawaiian energy market, which has the highest electricity rates in the U.S., the company says in a statement. The high rates give homeowners in the area a reason to switch to solar power, RGS says.
The purchase price works out to $7 million in cash and $9 million in RGS common stock, plus the potential for another $3 million in earnouts.
Other recent solar deals include Silverado Power’s merger with Sustainable Power Group. The combined company, called SPower, will develop, acquire and operate solar energy projects. Before that, in September, First Solar Inc. (Nasdaq: FSLR) agreed to buy a solar project in Nevada from K Road Power Holdings LLC.
In the past, solar panel makers have struggled as oversupply in the market drove prices down, leading to the bankruptcies of Solyndra LLC and many other solar companies. Most recently, in February, LDK Solar Co. Ltd, which Mergers & Acquisitions placed on our Distressed Company Watch List, filed for a type of bankruptcy called provisional liquidation in the Cayman Islands.
For more on solar panel companies, see “Finance Finesse: Solar Panel Groups Modify Loans.”