Soltec IPO brings light to the Spanish market

The renewable energy company Soltec Power Holdings reactivates the Spanish Mercado Continuo with its IPO, after two years without any debuts.

Soltec experienced a great debut at the Madrid stock exchange, the best IPO in five years with an increase of 11% and a total valuation of 488.8 million euros, which are good and predictable results. The overdemand reached in the previous days, worth 750 million, 5 times the amount of the capital increase, heralded a great day for the photovoltaic company.

Founded by its CEO Raúl Morales in 2004, Soltec specializes in solar trackers, photovoltaic panels that are oriented towards sunlight to make the most of solar energy. Their business has not stopped growing and they operate in 14 countries, with more than 1,500 employees on their staff.

 World leaders in solar energy utilization devices

After 16 years in the sector, they have become the third largest company globally, supplying 9.2% of the world’s solar trackers. Their presence is especially strong in the Americas, where 72% of the devices they have sold since their beginnings are installed. This is followed by Europe, with 25%, the Middle East, Africa and, lastly, Asia-Pacific. This powerful expansion has led them to become a benchmark in the sector with more than 35 international patents.

Soltec has currently two lines of business: Soltec Er, focused on production, distribution and installation of the trackers, and Powertis, focused on the development of photovoltaic projects. The business model of the Murcia-based company aroused a lot of interest among investors. So much so that its IPO, initially scheduled for Thursday, October 29, was brought forward one day. Another factor that also positively influenced the appeal of the operation is the inactivity of the market itself, as two years have passed since the last IPO – curiously also led by a solar energy company, Solarpack.

Spain, leader in the photovoltaic sector in Europe, an engine to reactivate the economy

According to data from the Spanish Photovoltaic Union (UNEF), the Spanish market led the growth of the European photovoltaic sector in 2019 ranking sixth worldwide. Forecasts are very optimistic suggesting that this trend will continue in the coming years. This is good news for investors who are now part, to a greater or lesser extent, of the world of renewable energy.

This is encouraging data for a key sector in the reactivation of the economy and in job creation. In recent years, the 95% reduction in costs in the generation of solar energy has been reflected in a contribution of more than 5,000 million euros to GDP and 1,522 million to exports. In addition, the photovoltaic sector has created more than 60,000 direct, indirect and induced jobs. These figures show how important the sector is for the future.

Going public to finance project development and debt reduction

Their financial situation before going public was far from ideal. According to data provided to the National Securities Market Commission (CNMV), Soltec had a negative balance of 2.4 million euros, caused by delays related to Covid and a net debt of 104.6 million.

This operation seeks to obtain financing to continue its expansion by promoting Powertis,, its platform for development and investment in solar photovoltaic projects. Approximately 60 million will go to capitalize on the growth of the industry through this platform, and the remaining 80 million will be used to boost its EBITDA and reduce its leverage ratio between 1 to 1.5.

Operation highlights:

  • Capital increase of 150 million euros.
  • 15 million more if the additional purchase of shares (greenshoe) is executed.
  • Over-demand: requests worth 600 million not covered.
  • Price per share: € 5.35 after starting at € 4.82.
  • 264,950 shares for employees at € 4.34.
  • 11% revaluation with a total capitalization of 488.8 million.
  • Initial valuation of 440 million.
  • The new investors will have 35.8% of the capital of the company.
  • Santander and CaixaBank, leaders of the operation, alongside JB Capital and Berenberg,, with Rothschild as advisor to the company.

Two long years have had to pass to see an operation like this in the Spanish market again. We hope that the important step Soltec has taken will encourage more companies to go public.