Vivint Solar Closes $200 mn Revolving Asset-Based Facility

Vivint Solar has announced that it has closed a USD 200 million revolving asset-based loan facility, to help fund the company’s continued growth in 2020

Vivint Solar has announced that it has closed a USD 200 million revolving asset-based loan facility. The firm has announced that the facility will help fund the company’s continued growth in 2020 and beyond by allowing it to finance the purchase of safe harbor equipment and receive attractive advance rates on projects throughout the development life cycle. 

The firm intends that the equipment purchased in 2019 and funded in part through this Asset Financing Facility will allow solar energy systems to qualify for a 30 percent federal investment tax credit (ITC) by satisfying the 5 percent safe harbor method outlined in IRS notice 2018-59. In addition, proceeds from the Asset Financing Facility will be used by the company to refinance its existing working capital credit facility that was set to mature in 2020.

Thomas Plagemann, Vivint Solar‘s chief commercial officer and head of Capital Markets said that this transaction represents an evolution of how the firm finances its working capital needs and replaces its current working capital facility which matures next March. 

“The innovative structure best addresses the working capital needs of our rapidly-growing business while also providing critical funding for the purchase of safe harbor equipment at attractive borrowing rates. We believe this facility, in addition to the other safe harbor strategies announced previously, will enable the company to preserve the 30 percent ITC well into 2021.”

The lenders include affiliates of Bank of America Securities and Credit Suisse. Vivint Solar operates in 22 states and has raised more than USD 4.9 billion in cash equity, tax equity, and debt since its inception in 2011.

In August, it was reported that the firm had closed a USD 325 million revolving warehouse credit facility, which refinanced the aggregation credit facility that was set to mature in 2020. The new warehouse reduces the cost of debt by 87.5 basis points and materially increases the number of upfront proceeds as a percentage of future contractual cash flows. Five lenders are involved in the deal, which includes an accordion feature that provides the ability for VSLR to upsize the facility to USD 400 million.