Solar Spectrum, a new company backed by equity firm Northern Pacific Group, has acquired Sungevity for $50 million as part of a court-approved bankruptcy sale. The sale handed the new company Sungevity’s operations infrastructure, $800 million in assets and $189 million of debt.
"Today marks a new beginning for this business. I am proud to lead a new player in the residential solar market that has a healthy balance sheet and a competitive value proposition. We thank our employees, customers and partners for their patience and for their continued support and commitment. Together, we will focus on building a sustainable and successful business at the forefront of solar as the industry continues to grow,” said Patrick McGivern, CEO of Solar Spectrum.
As part of the agreement, Solar Spectrum acquired Sungevity’s infrastructure, technology, installer network, supplier networks and certain customer agreements. The company agreed to provide Sungevity’s customers, abandoned during its 2016 bankruptcy, a chance to purchase warranties that are competitively priced under current solar market conditions with terms that will commence in early May 2017. Additionally, Solar Spectrum will continue to operate Sungevity’s European businesses under its current branding.
Solar Spectrum, with the assistance from Northern Pacific, plans to leverage its capital base to create a sustainable business model throughout its operations. ”The residential solar market remains extremely attractive and fragmented, and we see ample opportunity for innovation and targeted growth through future acquisitions. We have a lot of experience working with multi-local service businesses to refine their customer acquisition efforts and create sustainable growth, and we will bring this experience to Solar Spectrum,” Scott Honour, managing partner at Northern Pacific Group.
Under the acquisition agreement Solar Spectrum committed to hire a majority of Sungevitiy’s current and displaced employees. During its bankruptcy Sungevity was embroiled in labor controversy. In March former employees had filed a class-action lawsuit against the company claiming that it failed to warn employees of layoffs in a timely manner as mandated by the Worker Adjustment and Retraining Notification Act. The suit claimed that Sungevity owed laid-off employees back pay, payments into company health plans, unpaid vacation and personal time-off and unpaid commissions and bonuses, according to PV Magazine.Tweet