SunEdison and private equity firm, First Reserve are to partner in a joint venture that could ultimately lead to project investments of US$1.5 billion. Initially, US$167 million will be contributed by First Reserve and SunEdison that could potentially see solar projects developed in the United States, Canada, Italy, and Spain.
“We are excited to partner with First Reserve, a proven leader in energy infrastructure financing,” said Carlos Domenech, President of SunEdison. “The industry needs efficient and scalable financing models to meet demand. We expect the joint venture to help facilitate the development of our existing backlog of project opportunities and prospective projects that meet our development criteria.”
The move would seem to shift project finance requirements away from SunEdison’s owner, MEMC, especially for existing projects in its pipeline after its recent acquisition. Additional debt financing is expected to fund the acquisition of solar projects developed by SunEdison with an enterprise value of US$825 million.
It was noted that First Reserve may raise an additional US$150 million, coupled with a corresponding increase in project debt financing, which would take investments to US$1.5 billion. No timelines were given for the capital contributions.
Mark Florian, Managing Director of First Reserve Energy Infrastructure said, “We believe the portfolio will generate a predictable long-term cash flow suitable to our focus on long-term infrastructure markets.”