(Bloomberg) -- SunPower Corp. bought U.S. residential solar provider Blue Raven Solar for as much as $165 million in cash as the Silicon Valley firm shifts focus away from serving big companies and the public sector.
SunPower will gain about 20,000 customers from the takeover, the San Jose-based company said Tuesday in a presentation, adding to the firm's 376,000 residential clients. SunPower also said it's exploring “strategic options” for its commercial and industrial solutions business as it shifts efforts and investments toward expanding its residential and light commercial operation.
“We see the U.S. residential solar market as a land grab opportunity,” SunPower Chief Executive Officer Peter Faricy said Tuesday in a conference call with analysts.
Orem, Utah-based Blue Raven was founded in 2014 and operates with a direct-to-consumer sales and installation model that generated $136 million in sales in the last 12 months, according to the presentation. More than 90% of Blue Raven's customers are in 14 states that account for just 5% of SunPower's sales, the presentation said. Blue Raven's CEO Ben Peterson will join the executive team of SunPower, which plans to build upon Blue Raven's current employee and contractor relationships.
“While the history of residential solar business acquisitions is largely mixed, we see this move as critical for SPWR to gain the necessary scale to compete effectively in the U.S. residential market, especially around customer acquisition costs,” Oppenheimer & Co. analysts led by Colin Rusch said in a Tuesday note to clients, referring to SunPower's stock ticker.
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