DCNS Buys Majority Stake in Irish Tidal Turbine Maker OpenHydro
DCNS SA, a marine engineering company, will spend as much as 130 million euros ($173 million) to gain a majority stake in Irish tidal turbine maker OpenHydro Group Ltd. as the industry moves toward commercialization.
The French company is increasing its holding in OpenHydro, which makes turbines that use tidal currents to generate electricity, to 59.7 percent from 11 percent, Chief Executive Officer Patrick Boissier said today on a conference call.
There are currently no commercial-scale projects in operation, though Siemens AG and Alstom SA both own stakes in marine-energy businesses. The shares that Siemens bought to complete its acquisition of Marine Current Turbines Ltd. last year implied a valuation for the company of 18 million pounds ($29 million), according to Bloomberg New Energy Finance.
“The valuation DCNS is putting on OpenHydro as a result of this investment is many times the valuation that Siemens put on MCT when it took over the latter early last year,” said Angus McCrone, senior analyst at London-based researcher BNEF. “The contrast is intriguing, and suggests differing views on the near-term potential for the tidal stream energy market.”
DCNS is buying shares from existing shareholders and also injecting new equity capital into OpenHydro, according to Boissier. The takeover is subject to regulatory approval and is expected to be completed in the first half.
France, which wants 23 percent of its energy to come from clean sources by 2020, plans to install as much as 6,000 megawatts of offshore wind, wave and tidal energy by 2020. OpenHydro is working with Electricite de France SA to install projects off the coast of Brittany.