Sunrun to acquire Vivint Solar for $3.2 billion in all-stock deal

Jul 7, 2020 02:20 PM ET
  • The brand-new, bigger Sunrun will certainly have 500,000 clients and greater than 3 GW of solar energy properties. Is there value in range in residential solar?
Sunrun to acquire Vivint Solar for $3.2 billion in all-stock deal
Image: Sunrun

Sunrun, the leading carrier of property solar, battery storage and power solutions, as well as Vivint Solar, a domestic solar carrier in the United States, have entered into a contract under which Sunrun will obtain Vivint Solar in an all-stock transaction.

" This procurement, coupled with Tesla's statement recently to offer some of the cheapest residential solar offerings, shows that the marketplace is longing for price efficiencies," Ravi Manghani, Wood Mackenzie's head of solar, told pv publication. "With the upcoming ITC stepdown, the following frontier of domestic solar market plays will certainly have to get on the expense side. Sunrun has actually made a move to get a price advantage with acquisition."

The consolidated merged entity will certainly have a worth of $9.2 billion based upon the closing rate of Sunrun's shares on July 6. Vivint Solar investors are expected to own around 36% and Sunrun shareholders are expected to have approximately 64% of the completely weakened shares of the mixed firm-- supplying a 10% premium for Vivint Solar shares based on closing costs on July 6.

" Vivint Solar includes a crucial and high-grade sales channel that enables our consolidated company to reach even more households as well as elevate awareness regarding the benefits of house solar as well as batteries," claimed Lynn Jurich, Sunrun's CEO.

The firm will have a combined base of nearly 500,000 clients producing a leading owner of solar properties worldwide, with over 3 GW of solar properties on the balance sheet.

Sunrun thinks that residential solar, at just 3% penetration in the United States, still has plenty of space for growth.

Does range aid in household solar?

Sunrun anticipates to provide "meaningful cost synergies, approximated at $90 million on an annual basis." The company anticipates to "gain from performances in large task financing resources elevating tasks."

The purchase is anticipated to be finished during the 4th quarter of this year, subject to authorization by Vivint Solar and also Sunrun stockholders and also regulatory approvals. Sunrun's board of directors will be expanded by including 2 directors, one of which is expected to be Vivint Solar's CEO, David Bywater.

Solar Installers, Manufacturers