By Frank Andorka, Senior Correspondent
After the stock market closed, Enphase Energy – the once-struggling microinverter company that is seeing a resurgence under CEO Badri Kothandaraman, announced it was buying SunPower’s microinverter business for $25 million and 7.5 million shares of common stock.
Enphase stock rose 16% after the announcement.
The transaction means Enphase will now supply the microinverter technology for SunPower’s AC modules instead of SunPower producing the microinverters on their own. Tom Werner, SunPower CEO, tipped his hand about why the transaction took place in the release. He said the transaction will allow SunPower to “continue containing costs, leveraging R&D support and helping streamline our business priorities.” In other words, it will allow SunPower to focus all its energies on building modules instead of ancillary arms of the solar business.
The announcement comes weeks after SunPower announced it would purchase down-market rival SolarWorld and begin manufacturing more modules in the United States. Shedding the microninverter line is in keeping with a business strategy focused on building and expanding the company’s module lines both in the upscale and middle-tier residential markets.
On Enphase’s side of the ledger, the transaction provides a boost to a company clawing its way back to relevance after nearly two years of wandering in the darkness and falling under SolarEdge’s shadow. Starting in September, however, Enphase has racked up an impressive number of victories.
First, it posted profits for the first time in two years in Q4 and showed continued stability in the Q1 2018. It also signed an exclusive deal with Panasonic to provide microinverters to its AC modules, won a a court battle with SolarEdge over an ad and now the deal with SunPower. It’s unclear at press time what effect, if any, the SunPower deal will have on its agreement with Panasonic.
Taking a victory lap Kothandaraman said in Enphase’s release on the subject:
We are pleased to become the microinverter supplier for SunPower’s AC Modules. The IQ 7XS 320W AC microinverter in an ACM strongly complements SunPower’s high efficiency solar cells, communication and racking to create a high performance, high quality and easy-to-use Equinox™ Home Solar System, providing exceptional value to homeowners, dealers and architects.
Does this mean the microinverter battles at the industry’s two largest trade shows are over? No – in fact it may mean they are finally going to begin in earnest.