Thursday, May 29, 2014

Saaay, This "Financing Solar" Might Be for Real: SunEdison up 9% On 'Yieldco' IPO News (SUNE)

The stock is at $21.18, up $1.71. For the last couple years the money has definitely not been in the module or polysilicon makers but rather in the installers and financiers, especially the latter, links after the jump.
From MarketWatch:
SunEdison Inc. rallied Thursday following news its “yieldco” subsidiary has filed for an initial public offering.

TerraForm Power will own and operate clean-power plants and other assets acquired from SunEdison SUNE +8.65%  and other companies, SunEdison said. 

Goldman Sachs and Barclays are the joint bookrunners, and price and number of shares have not been decided yet, it added. 

SunEdison is following on the footsteps of giant NRG Energy Inc., which last year launched NRG Yield Inc., bundling solar and natural gas power-generation assets and raising nearly $500 million in capital in July.
Shares of Missouri-based SunEdison rose 9.4%. 

Several solar companies are looking into bundling existing solar-power plants and projects into subsidiaries, known in the industry as “yieldcos.” 

Revenues would flow from long-term, predictable power purchase agreements with utilities, and shares of the yieldcos would trade in stock exchanges just like any stock, providing liquidity and transparency....MORE
Entrepreneur Trades Sex for Solar
Finally for investors in rent-seeking organizations there is the real risk that the politicians will change the rules. Heed the words of Sen. Simon Cameron (R&D!-Pa.):
Our Hero
Simon Cameron
"The honest politician is one who when he is bought, 
will stay bought."