Days after the company announced its expansion into Austin, Texas, America’s leading solar power provider, SolarCity, announced it has taken in another million-dollar financing investment.
It hasn’t been the greatest of years for SolarCity, with its second quarter results yielding a massive $250 million net loss, leading to its founders taking salaries of $1 amidst dozens of layoffs. But that hasn’t stopped the company from moving forward, as proved by its announcement earlier this month that it was expanding its services into Austin, Texas.
SolarCity has backed that up this week with another announcement, this time revealing that the company has just raised $305 million in its second cash equity transaction. According to the SolarCity announcement, a private investment fund linked with Quantum Strategic Partners Ltd. and advised by Soros Fund Management LLC provided the equity investment in a portfolio of residential, commercial, and industrial solar projects, which also included a fully amortizing, 18-year loan that was syndicated to five high-quality institutional investors.
The announcement yields several benefits for the company, which at this point needs as many as it can get its hands on.
The fact that the equity investor and the lender group are separate allowed SolarCity to achieve a pre-tax, weighted average cost of capital for the transaction of 7.4%. Additionally, the syndication of a long-dated, fully-amortizing loan is believed to be a first of its kind for distributed solar assets.
In its announcement, SolarCity explained that it monetizes “its underlying cash flows in cash equity transactions, but retains ownership of the assets and continues to service the customers.”
The move is the company’s second big round of financing in the second half of 2016 already, with the first being a $345 million round of tax equity from four separate partners announced in July, intended to finance new solar projects.
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