ARRAY and Shoals agree solar equipment merger

ARRAY Technologies and Shoals Technologies Group have agreed a stock-for-stock merger that would combine structural and electrical balance-of-system equipment used in utility-scale solar installations, with opportunities to extend the integrated product portfolio into battery storage and data-centre power infrastructure.

The transaction, agreed on 4 November, will see ARRAY act as the legal acquirer, although Shoals shareholders are expected to own approximately 65% of the combined company’s basic shares. Completion is anticipated during the first quarter of 2027, subject to shareholder approvals, regulatory clearances and other customary conditions.

Under the agreement, Shoals shareholders will receive 1.6931 ARRAY common shares for each share they hold. Reuters calculated an implied Shoals valuation of approximately $1.32bn using the share prices prevailing when the transaction was announced. The consideration is entirely in shares, making its market value sensitive to changes in ARRAY’s share price before completion.

The proposed combination brings together two areas of solar power infrastructure that must operate together but are frequently designed and procured through different supplier arrangements. ARRAY specialises in structural balance-of-system equipment, including foundations, single-axis trackers and fixed-tilt mounting systems, while Shoals provides electrical infrastructure, wiring, connectors and power delivery products.

Structural equipment supports photovoltaic modules and maintains their position under changing environmental conditions. Trackers introduce controlled mechanical movement, while foundations must transfer equipment loads into the ground and accommodate the forces associated with wind, equipment weight and operating movement.

Electrical balance-of-system equipment performs a different function. Conductors, cable assemblies, connectors and collection systems establish the pathways through which electricity from photovoltaic modules reaches inverters and the wider electrical infrastructure of the generating plant.

The interaction between the two systems is especially important where trackers move photovoltaic modules throughout the day. Electrical cables must accommodate that movement without excessive tension, abrasion or interference with the structural equipment. Cable routing and mechanical clearances must therefore be considered together during design and installation.

Combining the product portfolios could allow structural and electrical interfaces to be specified earlier in the engineering process. A tracker system, foundation arrangement and associated wiring could be developed around common installation requirements instead of requiring contractors to resolve all interfaces between independently supplied products during construction.

Such coordination may simplify field assembly and reduce the number of separate design and procurement responsibilities. The eventual benefits will depend on the products developed and the degree of compatibility achieved, rather than following automatically from the ownership of the two businesses.

Large photovoltaic installations can involve substantial numbers of electrical connections distributed across long rows of modules. Conductors must be appropriately rated and protected, while cable management arrangements need to accommodate equipment movement, environmental exposure and access for inspection and maintenance.

Prefabricated wiring assemblies offer one means of reducing the amount of assembly required on site. Their suitability depends on the electrical design, connector compatibility, environmental conditions and applicable installation requirements. Factory preparation does not remove the need for electrical inspection and testing following installation.

ARRAY and Shoals intend to offer customers coordinated design packages, purchasing arrangements and warranty support across their combined structural and electrical product portfolios. The companies have also identified opportunities to improve interoperability between equipment categories, although specific integrated products resulting from the merger have not yet been announced.

The expanded offering would address equipment used throughout much of the solar generating plant, but would not eliminate the need for site-specific electrical and civil engineering. Soil conditions, terrain, module selection, installation methods, protection requirements and grid connection arrangements continue to determine the design of individual projects.

Both companies also see potential applications beyond conventional photovoltaic generation. Battery storage developments require power cables, connectors, collection networks and electrical distribution equipment, while data centres incorporate extensive electrical infrastructure for delivering power to computing, cooling and supporting systems.

ARRAY has already expanded its position in these markets through the acquisition of Affordable Wire Management, completed earlier in 2026. That business extended its cable management offering into battery storage and data-centre applications, complementing its existing tracker and foundation equipment.

Shoals brings further electrical product capabilities and experience supplying solar and battery storage projects. The merger could provide an opportunity to coordinate electrical equipment offerings across these applications, although the companies have not confirmed the technical specifications of any new integrated battery or data-centre power system.

The companies have identified potential commercial and operating savings from the combination. Management expects annual incremental adjusted EBITDA synergies of more than $100m within three years of completion, covering procurement, overhead expenditure, operational improvements and additional commercial opportunities.

First-year savings and revenue opportunities are expected to contribute approximately $35m in incremental annual run-rate adjusted EBITDA, comprising around $20m of cost savings and $15m from cross-selling. These figures are management forecasts rather than savings already achieved.

The commercial opportunity partly reflects the limited overlap between the businesses’ existing project portfolios. According to the companies’ assessment, only approximately 20% of projects served by ARRAY and Shoals during 2025 and the first nine months of 2026 used equipment from both suppliers.

Management believes broader purchasing across the combined portfolio could increase that overlap, although customers will remain responsible for determining whether particular structural and electrical equipment packages meet their project requirements. The merger does not establish an exclusive procurement arrangement for existing customers.

Indicative pro forma financial figures suggest combined 2027 revenue of $2.2bn to $2.4bn and adjusted EBITDA of $410m to $480m, including expected first-year synergies. The companies have emphasised that these ranges illustrate the potential scale of the combined operation and do not constitute audited financial forecasts.

Brandon Moss, currently chief executive of Shoals, is expected to lead the combined company, while ARRAY chief executive Kevin Hostetler will become a special adviser. Brad Forth is expected to chair the ten-member board, which will include representatives from both companies.

The transaction also involves changes to ARRAY’s capital structure, including a commitment to redeem $317.5m of preferred stock under agreed arrangements. An initial $161.3m redemption is scheduled within 90 days of closing, with the remaining amount payable through subsequent instalments.

ARRAY and Shoals intend to announce a new corporate name and stock market symbol after the transaction progresses. Until the necessary approvals are obtained and the merger closes, the two businesses will continue operating under their existing corporate structures.

The companies expect completion during the first quarter of 2027. Any integration of structural and electrical product development, purchasing, warranties and engineering support will follow that transaction, with the practical results determined by the compatibility, installation performance and adoption of the combined equipment portfolio.