Rumors are swirling that Vivint Solar, the second largest residential solar installer in theU.S., has filed for an IPO (initial public offering) that could happen as soon as fall 2014. The company has bandied about the idea since at least 2013.
However, the more recent news comes from Reuters in a piece written by Soyoung Kim and Mike Stone. While Vivint Solar and its partent Vivint, Inc. are part of the Blackstone Group LP, the Reuters writers said that the company filed for IPO the solar business. Under that filing Vivint and its other companies would remain with Blackstone.
Since the offshoot launched in 2011 Vivint’s founder Todd Pedersen has been bullish about taking on SolarCity. Vivint Solar has already made great strides, continually moving into new markets and the IPO is another step that could help it achieve that goal.
The company filed for the IPO under the Jumpstart Our Business Startups (JOBS) Act, according to the writers. The JOBS act allows companies with under $1 billion in annual revenue to file confidential IPOs with the Securities and Exchange Commission. As such Vivint Solar doesn’t have to offer details about its planned offering.
Going public will allow the company to raise capital more freely than it had in the past by offering stock to investors directly as opposed to creating funds through tax equity investors. SolarCity, its biggest competitor, is already public and has seen its stock raise since going public. By raising capital through stock offerings it also help bring down the cost of capital for company and potentially reduces the consumer costs for solar power as well.
Vivint Solar has already raised significant capital to support residential solar installations through third-party financing, including a $280 million tax-equity fund created earlier this year and more than $700 million that it raised in financing last year, according to GTM Research. In 2013 the company was installing up to about 6 megawatts of solar power a month and was installing solar on about 1,200 homes a month.Tweet