US residential solar provider Vivint Solar has closed another round of financing with a new term loan facility with lead bank Investec.
Vivint Solar announced that it had closed a $313 million term loan facility on Thursday, which refinanced 11 tax equity funds that were part of the company’s aggregation facility. Specifically, the new financing will provide back-leverage financing for a portfolio of 12 tax equity funds in ownership of 307 MW and 47,000 residential solar energy systems across 12 US states.
“We are pleased to announce this next step in our financing strategy, which allows us to repay outstanding loans under our aggregation facility, increase advance rates, free up new borrowing capacity, raise incremental debt against SREC contracts and lock in attractive all-in borrowing rates,” said Thomas Plagemann, Executive Vice President and Head of Capital Markets at Vivint Solar. “This new financing has a 5-year term, which is expected to exceed the projected flip dates for many of the 12 tax equity funds, and it enables us to continue our mission of making solar affordable for homeowners.”
The move comes only a few months after Vivint Solar closed a separate $75 million tax equity investment fund back in May, for the creation of more than 45 MW of residential solar capacity. In addition, Vivint Solar recently announced a partnership with Renovate America, to offer the latter’s Hero program as its PACE financing option.
The term loan transaction was arranged by Investec Bank plc, ING Capital LLC, Silicon Valley Bank, and SunTrust Robinson Humphrey Inc. as joint bookrunners.
“We are excited to have successfully closed this deal for Vivint Solar,” said Ralph Cho, Co-Head of Power and Infrastructure Finance at Investec. “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.”
“We believe that the commercial bank market is a very accommodating market of execution for leading players in the power sector,” added Michael Pantelogianis, Co-Head of Power and Infrastructure Finance at Investec. “Over time, we expect residential installers will find the bank market to be an attractive alternative to the securitization market.”