SunEdison Inc. Expanding Solar Power Plant Business

SunEdison  continues to expand its asset base in the solar industry, today announcing the acquisition of a 50% stake in Silver Ridge Power. The $178.6 million cash purchase from AES gives SunEdison a 50% stake in 336 megawatts of operational solar power plants.  

This broadens SunEdison's solar portfolio ahead of the launch of a yieldco named TerraForm Power, which will be a publicly traded company that holds solar power plants. SunEdison could then push assets down to the yieldco, much like midstream energy companies do with MLPs.

SunEdison did not explicitly state that it would push the new plants to TerraForm, but the company is increasingly becoming a project developer and needs capital to keep building those projects. The yieldco model offers a way to monetize projects while keeping them in a subsidiary.

The market has had little reaction to the Silver Ridge Power stake today, but that's not surprising because it's really just business as usual. It'll be more important that SunEdison executes on its own pipeline and gets attractive terms in the TerraForm IPO, because that's where shareholders are going to see more value generation.

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. And there's one small company making Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!

The article SunEdison Inc. Expanding Solar Power Plant Business originally appeared on

Travis Hoium owns shares of Apple. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story