ARRAY Technologies, a provider of structural balance-of-system (SBOS) solutions for utility-scale solar, and Shoals Technologies Group, which supplies electrical balance-of-system (EBOS) equipment for utility-scale solar and battery energy storage, said the companies have agreed to combine in a stock-for-stock merger. The firms on Nov. 4 said the deal “creates an integrated energy infrastructure platform that brings together complementary, market-leading solutions across foundations, trackers, fixed-tilt racking, electrical infrastructure, wire management and power delivery systems.”
The companies in a news release said ARRAY will serve as the corporate parent of the combined company. Shoals’ shareholders will receive a fixed exchange ratio of 1.6931 ARRAY shares for each Shoals’ share they own. After closing, Shoals’ shareholders are expected to own about 65% of the combined company’s basic shares outstanding, and ARRAY shareholders will own the rest.
Officials said the combined company will serve solar and battery energy storage customers through a unified design package, with coordinated purchasing and integrated warranty support across SBOS and EBOS solutions. The groups said the merger supports delivery of “increasing levels of integration over time designed to reduce installation costs, streamline project execution and lower long-term maintenance requirements.”
“Today marks an important milestone for Shoals, ARRAY and the customers we serve,” said Brandon Moss, CEO of Shoals. “By bringing together two highly complementary businesses with experienced teams, we are creating an integrated platform with broader capabilities, deeper customer relationships and a stronger foundation for long-term growth. We believe the combined company will be positioned to better service customers, deliver more innovative and integrated solutions, realize meaningful synergies and pursue expansion opportunities across the solar value chain, data center markets and beyond.”
Kevin Hostetler, ARRAY’s CEO, said, “This transaction represents a compelling opportunity to create meaningful value for customers of both ARRAY and Shoals by bringing together our complementary strengths. Although structural and electrical systems must operate seamlessly together in the field, they have historically been designed and sourced through separate channels. This combination changes that. Together, we expect to deliver a differentiated, technically integrated and interoperable platform that simplifies project execution, enhances project economics and accelerates innovation for customers.”
Strategic and Financial Rationale
The companies said the merger will bring several benefits for customers, including more effective service through a unified design package, with coordinated purchasing and integrated warranty support across combined offerings. The combined company intends to offer customers enhanced flexibility and packaging choice across foundations, trackers, electrical infrastructure and wire management solutions, including the solar industry’s best performing ground screw, single-axis tracker, DC wiring solution and cable management hanger.
The groups said customer value will be enhanced “by streamlining project execution, reducing installation costs, and lowering long-term maintenance requirements through increased product integration. SBOS and EBOS solutions are highly symbiotic across solar and battery storage projects. By bringing these complementary product categories together, the combined company expects to deliver more integrated solutions that reduce interface complexity, enhance energy yield and reliability, simplify installation and lower customers’ total cost of ownership.”
Officials also highlighted both companies technical expertise in their respective markets, which should support innovation. The combined company also expects to realize savings in overhead and other expenses, and noted “Year-one cost synergies are expected to deliver approximately $20 million of incremental, run-rate Adjusted EBITDA [Earnings Before Interest, Taxes, Depreciation, and Amortization].” The combined company expects to benefit from Shoals’ approximately $1.6 billion of tax amortization and $237 million of Net Operating Losses, which are anticipated to reduce taxable income and limit the cash tax obligations of the combined company for the next several years.
Leadership Structure
Moss will serve as CEO of the combined company. Hostetler will serve as special advisor. Brad Forth, current chairman of the board of both ARRAY and Shoals, will serve as board chairman after the merger.
“Having had the privilege of serving as chairman of both ARRAY and Shoals, I have seen firsthand the complementary products, talented teams and shared commitment to customers offered by both companies,” said Forth. “Together, ARRAY and Shoals are well positioned to deliver enhanced value to customers, shareholders and employees. I also want to thank Kevin for his leadership and important contributions to ARRAY, as well as his valuable insights as he transitions to a Special Advisor role. I look forward to continuing to work with Brandon, who brings proven leadership, deep industry expertise and strategic vision to lead the combined company in this next phase of growth.”
The combined company intends to announce a new corporate name and ticker symbol in the coming months to reflect the expanded scope of its products, services and strategic opportunities.
—Darrell Proctor is a senior editor for POWER.
