SolarEdge charges into storage market with Kokam acquisition

The power electronics maker will buy 75% of Kokam’s shares for $88 million, with an intent to acquire the remainder thereafter. Strategic company acquisitions and close partnerships are characterizing this year’s inverter market, as companies seek to diversify and integrate storage systems and other technologies.

October 11, 2018 Marian Willuhn

Image: SolarEdge

From the pv magazine global site

SolarEdge has entered agreement to acquire a majority stake in Kokam Company, a South Korean provider of lithium-ion battery cells widely used in energy storage, emergency power supply and electric vehicles.

According to a SolarEdge announcement, the company will spend $88 million for approximately 75% of Kokam’s shares, with the price including transaction expenses. The transaction is expected to close within weeks, subject to customary conditions. The Israel-based power electronics maker says it will seek to acquire the outstanding Kokam shares, which are listed on the South Korean exchange, through open-market purchases. The transaction is expected to result in Kokam becoming a wholly-owned subsidiary of Solaredge.

“The acquisition of Kokam will enable us to grow our offering, adding already proven battery storage to our product portfolio,” said Guy Sella, CEO, chairman and founder of SolarEdge. “Our technological innovation, combined with Kokam’s world-class team and renowned battery storage solutions, will enable seamless integration with our current solutions, taking us a further step toward making solar installations smarter and more beneficial.”

M&A activity hotting up in inverter space

This year, SolarEdge acquired uninterrupted power supply provider Gamesa for a reported $11.5 million, to give the power electronics maker “substantially all of Gamatronic’s assets,” including its intellectual property and brand. Gamesa said it would retain a two-year earn provision for 50% and 33% of the net income of Gamatronic in each year, respectively, following the closing of the acquisition. Approximately 100 Gamatronic staff will work for SolarEdge under the switch.

SolarEdge is not the only company in the power electronics space to diversify its technology offering by entering strategic partnerships with companies from related sectors. A month ago, German inverter maker Kostal announced a close partnership with Chinese EV company BYD, citing better integration of inverters and battery storage. As batteries and inverters take on ever more complicated and digitally enabled tasks, streamlined communication interfaces and architectures will be vital to further the process. Such partnerships aim to develop standardized system components that link inverters and batteries.

Analysts at Wood Mackenzie Power and Renewables predict an increasing share of integrated solutions will characterize this year’s market. Previously, third-party providers integrated batteries and inverters into storage systems. Now inverter and battery makers are singling out those third parties to come up with new solutions. In addition to hardware coupling, companies are likely to integrate digital energy management solutions. Since these continuously communicate between inverter and batteries, standardized communications protocols and interfaces are vital.

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