SunPower, the Silicon Valley-based solar manufacturer, has announced that it is entering into a strategic partnership with French oil and gas company Total. Under the terms of the agreement, Total will launch a friendly tender offer for up to 60 percent of both SunPower’s outstanding Class A Common and Class B Common shares. The offer price of $23.25 per share for each class represents a 46 percent premium over the Class A closing price and 49 percent premium over the Class B closing price. In addition, Total promises to provide SunPower with up to $1 billion of credit support over the next five years.
The boards of both companies have already approved the transaction, but the deal still needs approval from the anti-trust authorities of both the U.S. and the European Union. After the agreement is in place, the two companies will enter into a research and collaboration agreement focusing on advancing photovoltaic technologies in multiple research and development projects. With China currently leading in the increasingly competitive solar industry, the partnership should give a needed boost to the efforts of both Total and Sunpower.
“With Total’s $1 billion credit support agreement, solar research and development investments and the other resources available through its global network, we have taken the next step in positioning our business for continued growth and long-term success, ” said Tom Werner, SunPower’s CEO. “Our relationship with Total will improve our capital structure enabling SunPower to accelerate our power plant and commercial development businesses, and expand our manufacturing capacity with lower cash requirements.”
“The world future energy balance will be the result of a long-term transition in which renewable energies will take their place alongside conventional resources,” said Philippe Boisseau , President, Total Gas and Power Division. “Over the past years, Total has built up sizeable renewable energy activities. Today, Total is executing on its strategy to become a major integrated player in solar energy. We evaluated multiple solar investments for more than two years and concluded that SunPower is the right partner based on its people, world-leading technology and cost roadmap, vertical integration strategy and downstream footprint.”