The two companies are what are referred to as “yield companies” and are partners of SunEdison, a renewable energy developer which is now in Chapter 11 bankruptcy.
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The yieldcos were not part of SunEdison’s bankruptcy in April and the companies said at the time that they had sufficient liquidity to operate and that their assets were not available to satisfy the claims of SunEdison creditors.
Both yieldco subsidiaries of Chapter 11 renewables firm SunEdison have said they were seeking mergers or sales of their entire businesses after it became increasingly possible that SunEdison would not emerge from bankruptcy proceedings.
TerraForm Global shares rose 1.5% in premarket trading; TerraForm Power shares were inactive.
The TerraForm companies said they were working with SunEdison toward a potential deal but that decisions made by the parent may require bankruptcy court approval.
BlackRock Inc. has joined a list of potential buyers for TerraForm Power Inc., a holding company founded and controlled by bankrupt wind-and-solar energy giant SunEdison Inc. “We are open to considering a transaction involving a new sponsor that would contribute to the stabilization and future growth of the Company’s very attractive platform of generation assets in a way that benefits TerraForm Global stockholders, including through negotiation of new sponsorship arrangements or through assumption of SunEdison’s existing sponsorship agreements”.
“If investors believe TerraForm can transition to a competently managed company freed of its ties to SunEdison, it would be a natural institutional target amidst the global search for yield”, Nathan Serota, an analyst at Bloomberg New Energy Finance in NY, said in an e-mail Wednesday.
BlackRock joins a slew of investors including Canada’s biggest alternative-asset manager, Brookfield Asset Management Inc., and billionaire David Tepper’s hedge fund Appaloosa Management LP, which are planning a joint offer.
The two yieldcos said earlier this week that they were working closely with SunEdison on alternatives.
TerraForm Global noted that its publicly traded sister company, TerraForm Power, Inc.
The financial advisers of TerraForm Global are Centerview Partners, Greentech Capital Advisors and AlixPartners.
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The legal counsel for both companies is Sullivan & Cromwell LLP.
