Otovo, a leading residential solar self-consumption and battery storage company, has completed a €40 million capital raising. The round was led by existing investors Å Energy, Axel Johnson Group and Nysnø (Norwegian Government Climate Investment Fund). The capital increase enables Otovo to secure its path to profitability and to lead the company to the number one position in the European residential solar market.
The capital increase was made entirely by existing shareholders. The main investors, who previously held 44% of Otovo’s shares, Axel Johnson Group (through its subsidy AxSol) received shares for €10 million, the state-owned climate fund Nysnø for €2.5 million and Obos for half a million euros. Å Energi (the large Nordic utility created by a merger in 2022) contributed more than half of the round, and was allocated shares for €22.5 million.
“The equity raise allows Otovo to aggressively pursue the opportunities given by an energy market in which the cost of building new solar energy is at an all-time low, traditional energy prices are rising and consumers are looking for ways to cut their expenses,” said Otovo CEO, Andreas Thorsheim.
The net proceeds of the private placement will be used for growth capital to strengthen the company’s positions in Europe and for general corporate purposes, to secure a path to profitability. The company expects to achieve profitability through a combination of sales volume growth, operating cost improvements and monetisation of the company’s underwriting assets.
“Thanks to the support and continued trust from our large shareholders Otovo has a strong financial foundation allowing us to work on sales volume increases, prudent cost reduction measures and subscription portfolio monetization to bring the company to profitability,” added Thorsheim.
At the same time, Otovo has decided to issue up to 17.4 million shares at the same price and has announced that it will restructure its key employee option programme.
Otovo has raised €100 million in debt and €60 million in equity in two rounds in 2023. The company offers a return of 15-20%, reduces billed consumption by up to 50% and allows the investment to be recovered in 7-10 years in installations where the customer buys the installation, before any aid or the inclusion of batteries in the installation. In the case of renting, the low monthly rental price means that the customer compensates for this payment with a reduction in the electricity bill they enjoy, leaving money in their pocket. By adding batteries, the savings can reach 90% of the consumption bill.
The company is already present in Norway, France, Sweden, Italy, Poland, Germany, Portugal, United Kingdom, Austria and Spain; offering its customers cost optimisation services, administrative procedures and installation of solar panels.