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SolarCity Completes Securitization

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SolarCity (NASDAQ: SCTY  ) has wrapped up an innovative financing arrangement. The company announced it has completed a securitization of its distributed energy assets, pocketing more than $54.4 million in financing. That facility is secured by a pool of the company's solar energy contracts. The deal is reported to be the first instance of a borrower drawing a loan backed by such assets.

The funding was effected via a private placement effected with sole structuring agent and book runner Credit Suisse. SolarCity is borrowing the money at an interest rate of 4.8%, and the facility matures in December 2026.

In the press release announcing the news, the company quoted CFO Bob Kelly as saying that "securitization gives us access to a new source of capital at a lower cost, and it allows us to more closely align our assets and liabilities." SolarCity offers fixed-price contracts, which mirror the fixed-rate structure of the debt facility.

At the end of its most recently reported quarter, the company had $136 million in cash and short-term investments and $250 million in long-term debt. 

 


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Eric Volkman
TMFVolkman

Eric has been writing about stocks and finance since the mid-1990s, when he lived in Prague, Czech Republic. Over the course of a varied career, he has also been a radio newscaster, an investment banker, and a bass player in a selection of rock and roll bands. A native New Yorker, he currently lives in Los Angeles.

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Related Tickers

8/28/2015 4:00 PM
SCTY $48.00 Up +1.77 +3.83%
SolarCity CAPS Rating: ****