sunedison to follow assets sale model for raising capital
Solar energy services firm, SunEdison, will implement 2,000 MW of solar projects in India over the next two years and continue to explore operational asset-sale option for raising capital, Pashupathy Gopalan, President of Asia-Pacific and Sub-Saharan Africa, said here.
“If you take Africa-Asia, India is far more interesting country for solar. In India today, we have visibility of 2 GW solar and wind projects, which as a pipeline for us is phenomenally strong. And, executing over 2GW in a couple of years period is quite a sizeable achievement in the context of India. We will continue to strengthen our business in India,” he said.
He stated that the US-headquartered firm has put in place three models as sources for raising capital. SunEdison sells its completed projects to public equity investors through a vehicle called Yieldco. “It is nothing but taking the cash flow generated from the assets and distributing it periodically to the shareholders of the assets,” he said. Its warehouse investment model enables it to transfer the operational asset to the warehouse partnership, in which the company chose to be a owner of 10 per cent or 20 per cent. So, the majority of the money comes back to the company and creates liquidity. It has done four such warehouse partnerships with investors including Goldman Sachs and J P Morgan.
It is also exploring selling small percentage of assets to a third party every quarter.
“Thus, it is not exciting to say that Sun Edison is selling assets. We have always been doing that as part of our business plan. In India, we may need about $2 billion capital for executing projects over next two years. Nearly 1.4 billion will come from the lending market or project financing market. Equity as a sponsor will be around $ 600 million. And for this part, we may come up with strategies to put money from one of the three options,” he said.