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[BENGALURU] British oil producer BP said on Friday it would buy a 43 per cent stake in solar energy firm Lightsource for US$200 million, marking its re-entry into solar.
Two decades ago, BP had set out to transcend oil, adopting a sunburst logo to convey its plans to pour US$8 billion over a decade into renewable technologies, even promising to power its gas stations with the sun.
That transformation - marketed as "Beyond Petroleum" - led to BP manufacturing solar panels in Australia, Spain and the United States and erecting wind farms in the US and the Netherlands. However, the company shed the business in 2011 due to intensified competition from cheaper solar panels from China.
Oil companies currently have relatively modest investments in a wide range of renewable technologies.
"We're excited to be coming back to solar, but in a new and very different way," BP's chief executive Bob Dudley said.
BP will pay Lightsource US$50 million when the deal is completed, with the balance paid in instalments over three years. The majority of the investment will fund Lightsource's growth pipeline, BP said.
BP will have two seats on Lightsource board and the solar company will be renamed Lightsource BP.
Lightsource BP will target the growing demand for large-scale solar projects and will continue to develop and deliver its 6 gigawatt (GW) growth pipeline, which is largely focused in the US, India, Europe and the Middle East, BP said.
London-based Lightsource has commissioned 1.3 GW of solar capacity to date and manages about 2 GW of capacity under long-term operations and maintenance contracts.
BP expects the deal to be completed in early 2018. Lightsource were advised by Rothschild, White and Case, Deloitte and Baker & McKenzie.