VantagePoint sees big clean tech deals in 2011

DAVOS, Switzerland Wed Jan 26, 2011 4:25pm EST

Vantage Point Venture Partners Chief Executive Alan Salzman in a file photo. REUTERS/Kimberly White

Vantage Point Venture Partners Chief Executive Alan Salzman in a file photo.

Credit: Reuters/Kimberly White

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DAVOS, Switzerland (Reuters) - Up to 10 companies in the hot "clean tech" sector will go public in multibillion dollar U.S. offerings this year and as many will be acquired in equally significant deals, VantagePoint Venture Partners Chief Executive Alan Salzman told Reuters.

One of Silicon Valley's preeminent investors in the clean tech industry -- Salzman's firm has backed electric car start-up Tesla Motors Inc and solar thermal company BrightSource Energy Inc, as well as others -- said in an interview at the World Economic Forum that the actions this year will be a validation of the sector's attractiveness to investors.

"You're going to see much more of an active pipeline," Salzman predicted on Wednesday. "You will see five to 10 significant, multibillion dollar IPOs in the U.S. this year, and as many meaningful acquisitions."

IPOs this year will come from makers of thin film solar panels, utility-scale solar power plants, algae oils, and smart grid components, Salzman said, adding that strategic buyers are likely to snap up clean tech companies this year.

"The Ciscos, IBMs, GEs and Siemens AG know they will make a lot of money in the transition of the current primitive grid to a smarter grid, which mimics the transformation we saw of the dumb phone network into the modern communications system," Salzman said.

He also expects overall clean tech investments to keep growing this year as the sector bounces back from a global recession that dampened investment even in growing industries.

"More money went into clean tech in 2010, up about 30 percent from 2009. We will see an increase in raw dollars (in 2011)," he said, but declined to specify the growth rate.

"As I talk to global institutional investors, (they realize) it's an underserved, attractive category."

Salzman, whose San Bruno, California venture capital firm is the world's largest investor in the sector, said he plans to double the size of his existing fund to $2.5 billion. As of last September, VantagePoint had invested half of the initial $1.25 billion fund.

"The idea is we don't just talk," Salzman said. "We're going to double our commitment and add to our team. Hopefully, we will be followed."

(Reporting by Kenneth Li, writing by Nichola Groom in Los Angeles, editing by Gerald E. McCormick)

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