Just earlier this month the future looked bleak for Vivint Solar, which ended its flailing merger agreement with SunEdison citing breach of contract. Now the company is seeing the sun with a new, $200 million funding round to support building solar rooftops across the U.S.
"This financing demonstrates Vivint Solar's continued ability to access capital markets for flexible capital," said Thomas Plagemann, executive vice president, Head of Capital Markets of Vivint Solar. "Now that we are free from the constraints of the terminated SunEdison merger agreement, we have demonstrated our ability to rapidly access the capital markets for flexible, term-debt financing to support our continued growth.”The new $200 million fund will come in two offerings. The first, is a short-term $75 million facility, is being offered at LIBOR (London Interbank Offered Rate) plus a 5.5 percent interest rate.
The second is a $125 million facility that will increase to LIBOT plus an 8 percent interest rate. The company stated that if it chooses to use the second facility the length of the term will increase to 4 years for the entire facility. The funding is secured by the Vivint Solar’s cash flows from its portfolio of installed residential solar systems and is supported by its long-term customer contracts with them.
The company explained that the financing is intended to provide it with “immediate liquidity with the option to upsize.” It will allow the company to support its staff, purchase solar panels and other equipment, and finance home solar, funding the company’s growth beyond 2016.
“We believe it provides significant flexibility as compared to several recently closed transactions in the residential solar market,” the company said. “This is the first step in a series of anticipated financing activities that were put on hold as a result of the now terminated SunEdison merger.”
Regarding the SunEdison merger, Vivint Solar announced that it is seeking damages for the benefits its stockholders expected in connection with the transaction. Vivian Solar alleged that SunEdison failed to consummate the merger when it was required to.Tweet