M&A

17 November, 2009

Chevron seeks more clean technology with partner

* Cleantech Open says big partners needed for success

* A "garage-to-Google" clean tech company deemed unlikely

* Chevron's $240 mln VC arm says portfolio doing well

SAN FRANCISCO, Nov 17 (Reuters) - The venture capital arm of Chevron Corp (CVX.N) has teamed up with a group promoting clean technology that believes success for new ideas is far more likely if established partners are involved.

The second-largest U.S. oil company said it wants early access to renewable energy technology through its partnership with nonprofit group Cleantech Open, set up in 2006 to support start-ups focused on energy, environmental and economic challenges.

The group feels partners such as Chevron can offer both advice and potential markets to entrepreneurs.

Cleantech Open Executive Director Rex Northen pointed out that "clean tech isn't high tech" and therefore it was very unlikely that renewable energy and energy efficiency players would grow to a global scale by themselves.

"We don't expect to see quite the same kind of growth from a garage into Google," Northen said in a telephone interview.

Chevron Technology Ventures, the company's $240 million venture capital division, dedicates a third of its capital to renewables, with stakes in Southwest Windpower, solar company BrightSource and biofuel companies Codexis, LS9 and Solazyme.

Trond Unneland, the VC arm's managing executive, said most of the 34 companies in its portfolio were doing very well despite a hostile economic environment and he had seen no slowdown in its deal log.

"A corporate venture capital team is even more attractive in downturns because of the knowledge and link to a potential customer," said Unneland, who could not comment on its returns but noted his fund was in the top quartile among those tracked by the National Venture Capital Association. (Reporting by Braden Reddall; editing by Andre Grenon)

Source: http://www.reuters.com