Vivint Solar, the second-largest residential solar provider in the United States, announced on Tuesday that it has closed a $325 million revolving warehouse credit facility which refinanced the aggregation credit facility that was set to mature in 2020 and is intended to reduce the cost of debt by 87.5 basis points, helping to fund the company’s future growth.
The new warehouse facility reduces the cost of company debt by 87.5 basis points and, according to the company’s press release, “materially increases the amount of upfront proceeds as a percentage of future contractual cash flows.” Vivint Solar hopes that the new warehouse debt facility will help fund continued growth.
“This transaction represents a meaningful improvement in our ability to access debt funding at a higher advance rate, at a lower cost, and earlier in the lifecycle of our assets,” said Thomas Plagemann, CCO and Head of Capital Markets.
“Higher advance rates and earlier funding reduces the need for working capital in the business and brings our funding more in line with when we incur creation costs. This new financing is part of our plan to continuously reduce our cost of business and provide inexpensive and clean energy solutions for our customers” said David Bywater, CEO of Vivint Solar. “The ongoing commitment from our lenders and the competitive terms of this warehouse facility reflect their trust in Vivint Solar’s financial strength and market momentum.”
Five lenders were involved in the deal — including Bank of America Merrill Lynch, CitiBank, affiliates of Credit Suisse, KeyBank, and Silicon Valley Bank — which also included an accordion feature providing the ability for Vivint Solar to upsize the facility to $400 million.
Vivint Solar has been able to regularly and successfully close significant multi-million-dollar financing rounds, helping it step into the United States’ second spot for residential solar installers, behind Sunrun and ahead of Tesla.
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