UK-headquartered oil giant Shell has acquired Daystar Power, a Nigeria-based provider of hybrid solar power solutions to commercial and industrial businesses, as it launches its renewable power presence in Africa.
The deal, which is subject to regulatory approvals, marks a significant acquisition for Shell which has long been active in the continent’s hydrocarbons market but must look for new sources of growth in light of climate change and the gradual phasing out of fossil fuels. The size of the deal has not been disclosed.
“This deal marks our first power acquisition in Africa and a fundamental step for Shell in growing our presence in emerging power markets. We have had a long and established presence in West Africa and with Daystar Power, we are taking our first steps into the renewable power space,” said Thomas Brostrøm, Shell’s executive vice-president for renewable generation.
“As we do this, we’re helping to address a critical energy gap for many who currently rely on diesel generators for backup power. Daystar Power has a loyal customer base and a promising growth outlook, and by combining our efforts and expertise, I believe we can make a real difference in the energy transition, for West Africa and beyond.”
Daystar Power’s co-founders and management team will stay in place as the firm looks to further build its operations in West African markets, while expanding to East and Southern Africa. The firm says it aims to its install solar capacity of 400MW by 2025 in a bid to supply the growing energy needs of commercial and industrial businesses.
The company, launched in 2017 by Jasper Graf von Hardenberg and Christian Wessels, is currently present in four countries, runs over 300 power installations with an installed solar capacity of 32 MW, and has a team of 140 employees. It plans to further grow its client base in the financial services, manufacturing and agricultural sectors. Existing clients include Seven-Up Bottling Company, Ghandour Cosmetics and UAC Foods.
“We have seen booming demand for solar energy in the African markets where we operate. That has been reflected in our growth: we are on-track to increase our installed solar capacity by 135% in 2022,” said CEO Graf von Hardenberg.
“As part of Shell we will be able to execute our mission even faster to deliver carbon emission reductions and power cost savings to businesses across Africa.”
In July 2021, Daystar announced that it had raised a $20m facility from the World Bank’s private sector arm, the International Finance Corporation, following on from a $38m series-B fundraising in January 2021.