Renewable energy company SunEdison and West Street Infrastructure Partners III (WSIP) and affiliates, have formed a $1 billion warehouse investment vehicle.
Named the WSIP Warehouse, the investment vehicle would fund construction costs and help acquire operating assets.
TerraForm Power, the yieldco of SunEdison, will own exclusive call right over the warehoused assets.
With $300 million equity committed, subject to conditions, The WSIP Warehouse fund is managed by Goldman Sachs.
Debt structuring will be led by Morgan Stanley, Bank of America and Deutsche Bank and will provide commitments for $700 million of debt in the form of a $500 million, five-year term loan and a $200 million, four-year revolving credit facility, according to a statement.
SunEdison has the option to expand the facility by up to $1 billion to a total of $2 billion, subject to conditions.
Brian Wuebbels, chief financial officer, SunEdison, says: “The warehouse provides incremental capacity for SunEdison to construct and hold assets in advance of drop down to TerraForm Power. It expands our capacity beyond our existing $1.5 billion First Reserve Warehouse and the $500 million dollar TerraForm Private Warehouse.”
SunEdison decided to augment its warehouse capacity based on its financing requirements through 2016 and after exploring alternative debt and equity transactions.
The company statement says SunEdison continues to explore financing alternatives, including expansion of its warehouse facilities.
“Completion of the formation of the WSIP Warehouse and the financial close of the related debt facilities are subject to customary conditions and are expected to occur by October 31, 2015,” the statement added.
Ajith Kumar S