8point3 Energy Partners LP, a recently formed joint venture sponsored by First Solar and SunPower Corp., disclosed that it has obtained a $525 million credit facility ahead of its upcoming initial public offering. Proceeds will be used to refinance existing debt, finance permitted acquisitions, to pay a distribution to the sponsors, and for general corporate purposes.
The five-year credit facility is split between a $300 million A term loan, a $25 million delayed-draw term loan, and a $200 million revolver. Pricing is L+200 flat for drawn amounts, with a 30 bps commitment fee on unfunded revolver and delayed-draw term loan commitments. The deal also is covered by a debt service coverage ratio of 1.75x beginning with the fiscal quarter ending Aug. 31, 2015, and a leverage ratio set at 7x through May 2016, 5.5x through May 2017, and 5x thereafter.
Funding under the loan will occur in conjunction with the IPO, with a ticking fee of 30 bps if the IPO does not occur during the 45-day grace period.
Credit Agricole CIB, Deutsche Bank, J.P. Morgan, Citigroup, and Goldman Sachs acted as joint lead arrangers. HSBC, Mizuho, and MUFG Union Bank also participated in the transaction. Credit Agricole is administrative agent.
8point3 Energy Partners has interests in more than 430 megawatts of solar energy projects, which serve utility, commercial and industrial, and residential customers. The company is based in San Jose, Calif. – Richard Kellerhals