NEW YORK --
First Solar Inc. and SunPower Corp., the two largest U.S. solar-panel
manufacturers, are planning a joint venture that will own and operate
some of their projects. The companies expect to register for an initial
public offering for the new venture, according to a statement Monday.
They didn’t say when that may occur or how much they would seek to raise
through the IPO. The shares surged in after-hours trading.
The SunPower-First Solar venture would be part of a
growing trend in the renewable-energy industry to pool projects into
publicly traded entities that offer shareholders payouts, known as yieldcos. Companies that build power plants, including Abengoa SA and NRG Energy Inc., sell completed projects to their yieldco affiliates and use that capital to fund new power plants.
“The two companies have been cats and dogs in terms of
whose technology is better, but at the end of the day it’s less
relevant as you look at the cost-effectiveness of solar and the value
that can be extracted,” Jeff Osborne, a Cowen & Co. analyst, said by
telephone. Yieldcos operate power plants and sell electricity,
using that revenue to fund dividends to investors. SunPower has projects
that could be included in such a vehicle right now, Osborne said. “SunPower is doing the heavy lifting in 2015 and
2016,” he said. “First Solar didn’t have enough projects to create one
immediately, but they do in the longer term. Getting together certainly
makes sense.”
Technology Mix
The partnership would be one of the only yieldcos to
hold primarily solar farms; other similar ventures hold a mix of wind,
solar and other generating technologies, said Jacqueline Lilinshtein, a
clean-energy analyst with Bloomberg New Energy Finance. It will also
combine SunPower’s polysilicon technology with First Solar’s thin-film
panels.
“A portfolio of the two technologies, which operate in
different sectors and geographies, could reduce risk, lower capital
costs and widen the pool of operating assets that feed into the
yieldco,” she said in an e-mail. First Solar gained 12 percent to $55.11 at 5:43 p.m.,
after the close of regular trading in New York. SunPower climbed 11
percent. Both companies report quarterly earnings Tuesday.
Copyright 2015 Bloomberg
http://www.renewableenergyworld.com/rea/news/article/2015/02/first-solar-and-sunpower-plan-to-form-joint-venture-yieldco
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