Shell has bought Daystar Power, a Nigeria-based company that provides businesses with solar energy solutions, marking its first acquisition of a renewable energy provider in Africa.
The deal value is undisclosed. Daystar took off in 2017 and has raised $97 million through multiple rounds of equity and debt financing. The most recent was a $20 million loan from the International Finance Corporation in July last year.
CEO Jasper Graf von Hardenberg said his company needed to raise more money to meet growing demand but opted to sell to Shell due to the latter’s strong balance sheet and “long history in Africa.” Both parties started discussing a potential deal in 2019.
Buying Daystar Power is Shell’s plan to “address a critical energy gap for many who currently rely on diesel generators for backup power,” said Thomas Brostrøm, Shell’s vice president for renewable generation.
Diesel prices doubled in Nigeria in the first quarter of this year and have remained high, exerting a great toll on businesses.