Spruce Power Buys Portfolio of 22,500 Solar Customer Contracts in its Largest-Ever Acquisition and First as a Public Company
March 23 2023 - 4:00PM
Business Wire
-Deal grows Spruce’s total customer contract
base by 44% to over 72,000 systems-
-Portfolio expected to generate over $21
million of annual customer billings and about $18 million portfolio
EBITDA -
-10 state deal expands Spruce Power into new
markets of Washington and Oregon-
Spruce Power Holding Corporation (NYSE: SPRU) (“Spruce” or the
“Company”), a leading owner and operator of distributed solar
energy assets across the United States, today announced the
acquisition of SS Holdings 2017, LLC and its subsidiaries (the
“Spruce Power 4 Portfolio”) from a US-based private equity firm.
The acquisition closed on March 23, 2023.
The Spruce Power 4 Portfolio features the customer payment
streams from approximately 22,500 residential solar contracts under
which customers purchase the clean electricity generated by rooftop
solar home power systems. The contracts are supported by
high-quality residential solar systems across 10 states that were
originated by the homebuilder Lennar Corporation and its legacy
residential solar platform, SunStreet, between 2013 and 2020. The
acquisition expands Spruce into two new markets, Washington and
Oregon, while providing additional customers in California,
Colorado, Florida, Nevada, Texas, Delaware, Maryland, and South
Carolina.
The Spruce Power 4 Portfolio has an average remaining contract
life of nearly 15 years. Consistent with Spruce’s existing
portfolio, underlying credit characteristics of the SEMTH Portfolio
are strong with an average customer FICO score of approximately
740. The portfolio is expected to generate over $21 million of
customer billings in 2023, and about $23 million of average annual
billings over the next five years. Portfolio EBITDA, and
contribution to Spruce’s annual Cash Available for Debt Service
(“CAFD”), is expected to exceed $18 million annually during that
time.
Christian Fong, CEO of Spruce Power commented, “This acquisition
is the largest in Spruce’s corporate history. It grows our
ownership of rooftop solar assets and contracts by about 44%
overnight to more than 72,000 systems, demonstrating the power of
our strategy to grow by acquisition while earning an attractive
rate of return on our invested cash. Along with the $35 million we
paid, we assumed $125 million of non-recourse project debt. With
nearly $12 million in cash in the acquired business, our net Spruce
balance sheet cash paid at closing was about $23 million. For
future acquisitions, that leaves us with over $180 million of
Spruce balance sheet cash. We expect this portfolio will make a
large, positive and immediate impact on our financial and strategic
outlook.”
About Spruce Power
Spruce Power Holding Corporation (NYSE: SPRU) is a leading owner
and operator of distributed solar energy assets across the United
States. We provide subscription-based services that make it easy
for homeowners to own and maintain rooftop solar and battery
storage. Our as-a-service model allows consumers to access new
technology without making a significant upfront investment or
incurring maintenance costs. Our company owns over 70,000 rooftop
solar assets and contracts across the United States. For additional
information, please visit www.sprucepower.com.
Forward Looking Statements
Certain statements in this press release may constitute
“forward-looking statements” within the meaning of the federal
securities laws. Forward-looking statements generally are
accompanied by words such as “believe,” “may,” “will,” “estimate,”
“continue,” “anticipate,” “intend,” “expect,” “should,” “would,”
“plan,” “predict,” “potential,” “seem,” “seek,” “future,”
“outlook,” and similar expressions that predict or indicate future
events or trends or that are not statements of historical matters.
These statements are based on various assumptions, whether or not
identified in this press release, and on the current expectations
of management and are not predictions of actual performance.
Forward-looking statements are subject to a number of risks and
uncertainties that could cause actual results to differ materially
from the forward looking statements, including but not limited to:
expectations regarding the growth of the solar industry, home
electrification, electric vehicles and distributed energy
resources; the ability to successfully integrate XL Fleet and
Spruce Power; the ability to identify and complete future
acquisitions; the ability to develop and market new products and
services; the effects of pending and future legislation; the highly
competitive nature of the Company’s business and markets; the
ability to execute on and consummate business plans in anticipated
time frames; litigation, complaints, product liability claims
and/or adverse publicity; cost increases or shortages in the
components or chassis necessary to support the Company’s products
and services; the introduction of new technologies; the impact of
the COVID-19 pandemic on the Company’s business, results of
operations, financial condition, regulatory compliance and customer
experience; the potential loss of certain significant customers;
privacy and data protection laws, privacy or data breaches, or the
loss of data; general economic, financial, legal, political and
business conditions and changes in domestic and foreign markets;
risks related to the rollout of the Company’s business and the
timing of expected business milestones; the effects of competition
on the Company’s future business; the availability of capital; and
the other risks discussed under the heading “Risk Factors” in the
Company’s Annual Report on Form 10-K filed on March 31, 2022,
subsequent Quarterly Reports on Form 10-Q and other documents that
the Company files with the SEC in the future. If any of these risks
materialize or our assumptions prove incorrect, actual results
could differ materially from the results implied by these
forward-looking statements. These forward-looking statements speak
only as of the date hereof and the Company specifically disclaims
any obligation to update these forward-looking statements.
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version on businesswire.com: https://www.businesswire.com/news/home/20230323005705/en/
For More Information Investor Contact:
investors@sprucepower.com Head of Investor Relations: Bronson Fleig
Media Contact: PR@sprucepower.com
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