The merger aims to offer a genuine Pan-African footprint to provide competitive, full-service renewable energy and energy efficiency solutions to the C&I sector.

The merger, which is subject to standard regulatory approvals including anti-trust approvals, comes at an opportune time following favourable changes in South African renewable energy regulations, says the duo.

The merger will create the first Pan-African renewable energy services provider amidst a global drive towards a greener and cleaner energy sources. The duo says that they are well positioned to serve an even wider range of clients with a comprehensive mix of renewable energy solutions that provides:
  • power security
  • cost savings, and
  • carbon reduction.

The merged entity will comprise a portfolio of over 220MW of operated and contracted generation capacity, as well as 40MWh of operational battery storage with an additional generation pipeline exceeding 1GW.

Alongside the merger, funds managed by AIIM have committed substantial further funding to the South African subsidiary of the merged entity. This is to progress the build-out of the contracted pipeline in the C&I wheeling market in South Africa, providing energy security and certainty of pricing to large C&I customers.

Starsight Energy was founded in 2015 and is backed by Helios and AIIM, a member of Old Mutual Alternative Investments. It aims to offer reliable and sustainable energy and cooling solutions — on and off-grid — to the C&I sectors, with market-leading operations in East and West Africa with over 656 sites in:
  • Nigeria
  • Kenya, and
  • Ghana.

The company was named one of Africa's fastest-growing companies in 2022 by United Kingdom Financial Times. It is also the first renewable energy company in Nigeria to secure carbon credit accreditation, certified by the Verra Verified Carbon Standard (VCS) programme (the world's most widely used voluntary Green House Gas certification programme).

Founded in 2011, SolarAfrica has built up extensive experience in delivering state-of-the-art energy solutions through Power Purchase Agreements (PPAs) to businesses across Southern Africa.

It has evolved from a specialist provider of rooftop solar photovoltaic systems to a full-service provider of capex-free, green energy solutions — ranging from solar and battery storage options through to wheeling and electricity trading to the C&I market.

SolarAfrica says that it has already positioned itself as a competitive player in the newly enabled power wheeling space, having recently signed up large blue chip customers.

The group adds that it is now well positioned to service large power users with a lower-cost electricity alternative from a recently developed centralised solar generation site. This is taking advantage of South Africa's newly revised regulations permitting wheeling and self-generation of up to 100MW by private generators.

In 2021, SolarAfrica was named the continent's leading solar energy firm, scooping the Africa Solar Industry Association's African Solar Company of the Year Award.

Over and above the global shift towards the reduction of greenhouse gas emissions through decarbonisation, the demand for cost-effective and reliable power by commercial and industrial users will continue to grow and open further opportunities in the renewable energy sector, says the duo.

This is particularly in South Africa, where power supply is expected to remain constrained with a substantial deficit of generation capacity.

Tony Carr, Starsight Energy's group chief executive officer, says, "This merger demonstrates our joint commitment to expand our footprint across Africa. With SolarAfrica, the new combined group becomes one of the largest commercial providers of reliable and clean energy solutions to the commercial and industrial sector across the continent."

"The merger will enable efficiencies across the group, ranging from procurement to funding, and further allow for the rollout of our proprietary technology platform across the continent," adds Carr.

"These efficiencies will assist the group in providing a unique and valuable offering, which takes customers on a green energy journey to solve their power struggles and enables a sustainable future for their businesses," says David McDonald, SolarAfrica Energy's co-founder and chief executive officer.

Olusola Lawson, managing director and co-head at AIIM, says, "The transformational Starsight / SolarAfrica merger is a strong illustration of value creation in the nascent African commercial and industrial renewable energy space."

"As one of Africa's largest renewable energy equity investors, and with a renewable energy portfolio of c.2GW, AIIM has been privileged to play a key role in the growth and expansion of the Starsight platform over the last five years," adds Lawson.

"We are delighted to continue to support the business with additional funding to expedite the realisation of its substantial pipeline, and we look forward to the continued success of the combined platform," adds Lawson. 

Ogbemi Ofuya, partner at Helios Investment Partners, says, "This transaction combines the complementary capabilities and geographical reach of two leading players in distributed energy solutions for businesses and industries across Africa."

"Helios has been a part of Starsight's journey from its inception and has supported the growth of the business leveraging on our experience in building and scaling market-leading infrastructure businesses on the continent," adds Ofuya.

"This transaction creates a market leader across sub-Saharan Africa's largest economies, with a long track record of providing, cleaner and more reliable energy solutions for its customers delivered at competitive price levels. We remain excited about the significant growth prospects of the enlarged Starsight platform," Ofuya says. 

According to the duo, the newly formed entity will comprise of 340 staff across multiple jurisdictions and create a combined shareholder group providing financial capacity to deliver renewable energy services across Africa.

The two parties conclude that their expertise will not only position the group as Africa's leading provider of green energy solutions to commercial and industrial power users but will also accelerate Africa's transition towards a greater renewable energy mix.

This is alongside SolarAfrica's energy solutions software platform, which enables its sales teams to customise energy proposals and produce accurate savings projections. 

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