Vivint Solar obtains 5-year, $313m financing injection

Vivint Solar closed a $313m term loan facility, a sign that the struggling US installer of rooftop PV systems may be regaining confidence of some investors who have questioned its ability to succeed as a standalone company.

The 5-year syndicated credit facility provides back-leverage financing for a portfolio of 12 tax equity funds that own more than 307MW and 47,000 residential solar energy systems across 12 states. It provides an alternative to bond securitization.

Thomas Plagemann, head of capital markets at Vivint, says the funding will allow it to “repay outstanding loans under its aggregation facility, increase advance rates, free up new borrowing capacity, raise incremental debt against SREC contracts and lock in attractive all-in borrowing rates.”

Arranging the deal were Investec Bank, ING Capital Silicon Valley Bank and SunTrust Robinson Humphrey.

“Growing liquidity in the syndicated loan market for residential solar companies was evidenced by the 1.5x oversubscription to this facility, which should give future borrowers confidence," said Ralph Cho, co-head of power and infrastructure finance at Investec. 

Vivint shares rose on the news 2.3% to $2.85 in early New York trading. They remain on the low end of the 52-week trading range of $2.16-$14.04.

It has been a tough year for Vivint, whose majority owner is Wall Street giant Blackstone Group.

Chief executive Greg Butterfield resigned in May, two months after SunEdison failed to close on its proposed $2.2bn acquisition of the Utah-based company that he had enthusiastically backed. Vivint is now suing SunEdison, which filed for Chapter 11 bankruptcy protection on 21 April.

Expecting to be acquired, Vivint effectively put certain critical activities on hold during the eight months since the deal was made public. That slowed its efforts to get costs under control, a factor behind its larger first quarter operating and net losses.

Vivint will release second quarter results on Monday.