SunEdison's Takeover of Vivint Solar in Jeopardy
March 02 2016 - 5:00PM
Dow Jones News
SunEdison Inc.'s mounting financial woes have jeopardized its
purchase of rooftop-solar company Vivint Solar Inc.
Goldman Sachs Group Inc., Barclays PLC, Citigroup Inc. and UBS
Group AG have balked at providing loans they had committed to fund
the takeover, according to people familiar with the matter. The
banks have told SunEdison its failure to provide them with
up-to-date financial statements mean it hasn't fulfilled a
condition of the loan agreement, the people said.
SunEdison said in a regulatory filing Monday that it would delay
its 2015 earnings report while its board investigates claims from a
former and a current employee challenging the accuracy of the
company's financial disclosures.
SunEdison said it has found no wrongdoing. The review is still
under way and could require the company to "reassess its liquidity
position," SunEdison said. A company spokesman declined to comment
further Wednesday.
If the Vivint deal hasn't closed by March 18, either side could
walk away. SunEdison could line up alternative financing sources
for the deal, though its sunken stock price could make it difficult
to do so.
SunEdison shares plunged 23% Tuesday before regaining ground
Wednesday, recently trading at around $1.70. The stock has lost
more than 90% of its value since midsummer on investor concerns
about the Vivint transaction and a slide in oil prices that has
dragged down energy stocks.
When the deal was announced in July 2015, it was worth $1.9
billion. SunEdison and Vivint later renegotiated the deal, reducing
the cash portion. And Vivint's majority shareholder, Blackstone
Group LP, agreed to take stock in lieu of cash and to provide
SunEdison with a $250 million credit line.
Vivint stockholders, who approved the deal last week, would
receive $7.89 a share in cash plus other securities. Its shares
were trading around $6.81 Wednesday afternoon.
Matt Jarzemsky contributed to this article.
Write to Liz Hoffman at liz.hoffman@wsj.com
(END) Dow Jones Newswires
March 02, 2016 16:45 ET (21:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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