Utility-Scale Solar Farms as Speculative Assets in the European Market

This paper develops on the possible ramifications of M&A activity in solar farms. A theoretical model explores two possible mechanisms of M&A activity in solar assets: disposal of assets whilst in financial distress, or, alternatively, normal market behaviour as regards essentially marketable, speculative assets. Both theoretical paths lead to hypothesising inconsistent time preferences between the sellers and the buyers of solar farms. Three empirical case studies serve to partly validate the model. Critical levels of debt to equity in the balance sheet come as a highly likely trigger of disposals-acquisitions of solar farms