Crius Energy to buy Verengo assets, closes SunEdison deal
Solar system in California. Author: Matt Montagne. License: Creative Commons, Attribution 2.0 Generic.
Crius Energy Trust (TSE:KWH.UN) has agreed to buy substantially all assets held by Southern California-based rooftop solar installer Verengo Inc in a bankruptcy proceeding under Chapter 11.
Also, the trust said on Friday it had completed the acquisition of certain solar assets from another bankrupt company -- SunEdison Inc (OTCMKTS:SUNEQ). As announced in August, Crius Solar LLC had agreed to buy SunEdison’s proprietary residential solar lead-generation platform, customer lead databases, marketing materials and human capital in exchange for a one-time payment of USD 1.5 million (EUR 1.3m). This transaction was finalised on September 19.
As per the newly-unveiled Verengo deal, the trust has created a special purpose vehicle called Crius Solar Fulfillment LLC, which, in addition to buying Verengo’s assets, will also provide up to USD 4.8 million in debtor-in-possession (DIP) financing to support its continued operations during the sale process. Its bid for the assets reflects a purchase price of USD 11.9 million.
With headquarters in Torrance, California, Verengo has installed more than 20,000 solar systems for homeowners since 2008. Its acquisition by Crius Energy will bolster the firm’s capabilities in the California residential solar energy segment and allow it to expand in other states.
"This transaction augments our recent acquisition of the SunEdison platform as it provides vertically integrated capability in California. The acquisition is expected to contribute positive EBITDA in fiscal year 2017 as well as valuable strategic relationships with our partners in the transaction," said Michael Fallquist, the CEO of Crius Energy Trust.
The acquisition of Verengo by the Crius unit is subject to certain approvals required by the Chapter 11 bankruptcy process. Other interested parties will also have the chance to make bids for the assets.
Crius Energy Corp will initially hold a stake of 64.5% in Crius Solar Fulfillment and will take full control of the company by the end of fiscal 2017 through exchange transactions with the three non-controlling members, the trust added.