Solar power firm SunEdison filed with the Bankruptcy Court for the Southern District of New York Thursday morning after weeks of signs that the renewable energy company was in need of cash.
According to The Associated Press, an audit committee reviewing the Missouri-based company found an "overly optimistic culture and its tone at the top."
As Electric Light & Power previously reported, internal strife and its ill-fated attempt to merge with Vivint Solar lay at the heart of SunEdison’s problems.
Last month, Vivint sent its estranged partner a letter saying Vivint had terminated the agreement because SunEdison committed a “willful breach” of the merger deal.
In addition, SunEdison also notified federal regulators in March that it could not deliver its annual financial report because it was still investigating questions about its financial position.
The reason, SunEdison confirmed at the time, was due to “ongoing inquiries and investigations by the audit committee of the company’s board of directors...” In late 2015 the audit committee started an internal probe after former company executives alleged that previously disclosed financial records may be inaccurate.
The U.S. Department of Justice subpoenaed SunEdison “seeking information and documentation relating to… certain financing activities in connection with the company's acquisition of Vivint Solar, Inc., the conduct of a former non-executive employee who is alleged to have committed wrongdoing in connection with the Vivint termination negotiations, the previously disclosed investigations by the company's audit committee, intercompany transactions and other issues.
SunEdison was worth as much as $31 per share on the New York Stock Exchange only nine months ago. The company and Vivint first announced their proposed merger in the summer of 2015.
Vivint said March 9 it would seek damages from SunEdison over its "willful breach of the merger agreement" between Vivint Solar and SunEdison.
Among other things, Vivint Solar is seeking damages for the benefits its stockholders expected in connection with the transaction.
Gregory Butterfield, President and CEO of Vivint Solar stated "SunEdison has willfully breached its obligations under the merger agreement and we intend to pursue Vivint Solar's remedies vigorously."
As part of the deal, SunEdison was to buy Vivint's 523 MW rooftop solar portfolio for some $922 million in cash.
SunEdison’s last public reporting on financial returns was on November 9, when third-quarter results showed a net loss of $284 million. The nine-month toll was $919 million, down from the $939 million net loss during the same period of 2014.
At the same time, the company reported that it delivered a record 640 MW in renewables and had 2.9 GW worth of projects under construction, both significant increases year over year. SunEdison develops, finances, builds and sells solar and wind power plants.
Originally a spinoff of Monsanto Corp. engaged in silicon-wafer construction, SunEdison made its big move into solar power technologies about 10 years ago.
SunEdison went public in 2013.