SunEdison and Vivint Solar signed a merger agreement pursuant under which SunEdison will buy Vivint Solar for about $2.2 billion, payable in a combination of cash, shares of SunEdison common stock and SunEdison convertible notes.
In connection with SunEdison's proposed acquisition of Vivint Solar, SunEdison has entered into a definitive purchase agreement with a unit of TerraForm Power which, concurrently with the completion of SunEdison's acquisition of Vivint Solar, will acquire Vivint Solar's rooftop solar portfolio, consisting of 523 MW expected to be installed by year-end 2015, for $922 million in cash.
The 523 MW of residential solar power projects are expected to provide a 10-year average unlevered cash available for distribution of $81 million, and provide a ten-year average levered cash-on-cash yield of 9.5 percent.
In addition, TerraForm Power will acquire future completed residential and small commercial projects from SunEdison's expanded residential and small commercial (RSC) business unit.
The addition of residential and small commercial projects and cash available for distribution to TerraForm Power is expected to provide greater visibility and predictability to CAFD growth and dividend per share accretion at TerraForm Power.
The rooftop solar portfolio is expected to add a growing, high-quality, long-term contracted and geographically diverse asset base to the SunEdison family of companies, strengthening one of the largest and highest-growth global renewable power platforms in the world.
The Vivint Solar management team will join SunEdison. SunEdison's existing RSC development business and the Vivint Solar team will be merged. The transaction expands SunEdison's strong RSC platform and is intended to accelerate SunEdison's existing business in the United States, United Kingdom and Australia.