Total SA already ranks among the world’s largest petroleum producers, but with its acquisition of 60% of U.S.-based SunPower Corp. for $1.3 billion, the Paris-based conglomerate now ranks as the No. 1 solar energy provider among big oil firms.
Total SA is moving into solar power despite the challenges posed by low-cost Chinese manufacturers and spotty support from government subsidies around the globe.
How big a deal is this for Total SA? It's simply a marketing deal to "improve their image." Remember all the environmentally-friendly ads by BP before THE spill?
Total SA is keeping SunPower’s senior management in place. The deal also allows SunPower to continue trading as a public company, partly to provide an incentive to management to build value in the firm.
Total SA has no current plans to acquire the remaining 40% of SunPower’s common stock.
Total SA said solar profits are choppy right now, with subsidies needed until the cost comes down to grid parity in coming years.
Will it "move the needle" for Total SA?
“SunPower probably won’t reach much more than 1% of their energy production, but it still has growth in it,” one analyst said. “They need every type of energy in their mix and every bit adds up.”
Yup. One percent at a time.
- Total SA's annual revenues: $212.77 billion.
- Total SA's net income: $17.01 billion. ($17,010,000,000)
- SunPower's annual revenues: $2.2 billion.
- SunPower's net income: $179 million. ($179,000,000)
Can one say "rounding error"?
Is it an urban legend or is it true that General Motors bought all the light rail in southern California decades ago?
Is it an urban legend or is it true that General Motors bought all the light rail in southern California decades ago?
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