Residential leasing giant SolarCity announced plans earlier this week to purchase Paramount Solar. The purchase was made as the third-party ownership company announced that it plans to have 1 million customers and 6 gigawatts of solar energy deployed in the next five years and that it raised its full-year 2013 guidance to 278 megawatts of installations. SolarCity is already the nation’s largest thrid-party ownership company for residential solar installer with more than 3,300 employees and 400 megawatts of solar deployed nationwide.
SolarCity purchased Paramount for roughly $120 million, with $116.3 million in stock and the remainder in cash. SolarCity called Paramount Solar one of its most successful channel partners. At least two Paramount executives will join SolarCity. Ben Van de Bunt, the CEO of Guthy-Renker, which owns Paramount Solar’s parent Paramount Equity, will join SolarCity’s board later this year. Hayes Barnard, CEO of Paramount Equity—Paramount Solar’s parent—will serve as SolarCity’s chief revenue officer after the deal is finalized.
“Hayes Barnard and Guthy-Renker have built what I strongly believe to be the best virtual sales organization in the solar industry, with an extraordinary ability to acquire customers at a low cost,” said SolarCity CEO Lyndon Rive. “We expect the addition of Hayes, Ben and the Paramount Solar team to help us attain our goal to reach one million customers in the next five years at an even lower cost than was previously possible,” he added.
“Over the past four years, the Paramount Solar team has built the company into a direct marketing and virtual sales powerhouse. We are incredibly proud of this accomplishment and feel that it is the perfect time to join forces with SolarCity, to offer more customers the ability to take control of their energy costs by producing clean, renewable energy,” Barnard said. “Together, we’ll develop the most sophisticated customer acquisition and installation system in the industry to provide one million customers with residential solar systems, forever changing the way energy is consumed, and at a lower cost.”
SolarCity anticipates that the purchase of Paramount Solar will expand its 2013 pipeline of installations to 278 megawatts because of the company’s backlog. It anticipates an even bigger impact to its project pipeline in 2014. “The national residential solar market has been growing between 60 and 70 percent annually, and we’ve been growing at twice that rate—144 percent year over year in the most recent quarter—and had three times the market share of our nearest competitor in 2012,” said SolarCity CEO Lyndon Rive.