SUNation Solar Systems, one of Long Island’s largest and longest-operating solar panel and battery installation companies, has been acquired by Pineapple Energy of Minnesota in a cash and stock transaction valued at $22.5 million, according to regulatory filings.
Ronkonkoma-based SUNation, with nearly two decades in business and over 8,000 home and business systems installed on Long Island, will continue to employ 170 local workers and operate regionally for Pineapple, which also installs solar energy and backup power in regional pockets across the country. The SUNation name will remain.
Pineapple chief executive Kyle Udseth, in a statement, said the acquisition of SUNation “will give us more scale, increase our revenue substantially and move us toward achieving the important goal of reaching cash-flow positive in 2023.” It also expands the company’s footprint into the northeastern United States, where there’s “strong demand for solar energy.”
For the quarter ended June 30, Pineapple, which has been acquiring other regional companies, reported sales of $5.89 million, an operating loss of $3.1 million and net income of $1.4 million. Its filing didn’t list sales in the prior year’s quarter, but the net loss a year ago was $2.26 million.
SUNation co-founder and chief executive Scott Maskin will continue to manage SUNation for Pineapple as senior vice president and general manager of the New York region, and will join Pineapple's board, according to an SEC filing.
Maskin, who was the majority shareholder of the privately held SUNation after the retirement of his longtime partner, Mike Bailis in 2021, said he viewed the transaction more as a merger than an acquisition, as he becomes one of the larger shareholders of Pineapple.
He said he’d been working on finding the right merger partner for SUNation for the past eight years and turned down an acquisition offer by energy giant NRG years ago because “it wasn’t the right fit.”
He said the Pineapple arrangement affords SUNation a chance to become a national player with the likes of Sunrun and Sunnova Energy, with better access to capital markets to grow the business.
“It’s not a buyout for Scott," Maskin said, meaning his motivation wasn't to enrich himself. “I’m emotionally and financially tied to this merger. I’m just tired of being in the kiddie pool” of being a regional operator with “zero access to capital.”
The deal is a “win for my employees,” who will have access to company stock and better health benefits, Maskin said, along with the opportunity to grow with the company to other regions of the country.
Pineapple, he said, is a “small and nimble company,” with a business model of operating “regionally dominant companies like SUNation to drive their customer experience in their region.”
And while he doesn’t expect Pineapple will be in the market for another Long Island acquisition or merger, he did express interest in the New York City region. “There’s no more eggs in this basket,” he said. “We want more baskets.”
Bailis, the co-founder, on Thursday offered congratulations to the company, adding, “I’m proud of what we accomplished, and I wish them all the luck in the future.”