Energy · Profile from Energy Research Companion
SunEdison
The St Louis-area company that began in 1959 as Monsanto's silicon-wafer maker (MEMC), bought the pioneering US solar developer SunEdison in 2009, took its name in 2013 and, in three years, used two listed "yieldcos" — TerraForm Power (Jul 2014) and TerraForm Global (Jul 2015) — to become one of the world's largest renewable-energy developers. The yieldcos were meant to give it a permanent low cost of capital; instead they tied its funding to its share price. After the ~$2.4bn First Wind deal, a ~$2.2bn agreement to buy Vivint Solar (20 Jul 2015) and a peak share price of ~$33 that same month, the yieldco market turned, SunEdison's short-dated debt came due and it filed for Chapter 11 on 21 Apr 2016 with ~$16bn of liabilities (reported) — one of the largest non-financial bankruptcies of the decade. Most of its projects worked and still run, under Brookfield and others. The failure was in the parent's financing, not its power plants.
At a glance
- Founded
- MEMC: Monsanto Electronic Materials Company, announced 1959, production in St. Peters, Missouri from 1960; SunEdison LLC: founded 2003 by Jigar Shah in Maryland (reported) as a pioneer of the US solar power purchase agreement; MEMC bought SunEdison LLC in Nov 2009 (~$200m, reported)
- Headquarters
- St. Peters / Maryland Heights, Missouri (MEMC) → Maryland Heights, Missouri and Belmont, California offices (SunEdison, reported, verify)
- Ownership / structure
- Public (NYSE: WFR → SUNE from 30 May 2013); controlled and consolidated two listed yieldcos via Class B shares and incentive distribution rights: TerraForm Power (NASDAQ: TERP) and TerraForm Global (NASDAQ: GLBL); held ~49% of SunEdison Semiconductor (SEMI) after its May 2014 IPO until 2015–16 (reported)
- Leadership
- Ahmad Chatila (CEO from Feb 2009 to Nov 2016, reported); Brian Wuebbels (CFO, later president of the yieldcos, reported); John S. Dubel (chief restructuring officer, then CEO in bankruptcy); Emmanuel Hernandez (chairman, reported)
- Scale (peak)
- ~7,300 employees and ~$2.48bn revenue (2014, reported); market value ~$10bn (Jul 2015, reported); development pipeline reported in the tens of GW across the US, Latin America, India, China, South Africa and elsewhere (company claim, verify)
- Debt and failure
- Chapter 11 filed 21 Apr 2016, SDNY; petition listed ~$20.7bn of assets and ~$16.1bn of liabilities at 30 Sep 2015 (consolidated balance sheet; reported by Reuters/Fortune); debt alone was ~$11–12bn in other summaries; shares closed at ~$0.34 on filing day (reported); emerged as a small private company 29 Dec 2017
- Yieldcos' fate
- Brookfield Asset Management affiliates (Orion US Holdings 1) bought 51% of TerraForm Power (closed 16 Oct 2017) and all of TerraForm Global ($5.10 a share, closed 28 Dec 2017); Brookfield Renewable bought the rest of TerraForm Power in Jul 2020 (reported)
- Signature moves (incl. failures)
- MEMC buys SunEdison (2009); rename and developer pivot (2013); TerraForm Power IPO (2014); First Wind (2014–15); TerraForm Global IPO (2015); the Vivint Solar deal and collapse (2015–16); Chapter 11 (2016); Brookfield buys the yieldcos (2017)
8 strategic moves analysed
Each one gets a full strategy file in the companion: context, the decision, the financing, what happened, and the lesson.
2009
MEMC Buys SunEdison
Acquisition / strategy pivot (vertical integration downstream)
2013
Rename and Developer Pivot
Strategy pivot / rename / spin-off (semiconductor wafers)
2014
First Wind Acquisition
Acquisition or merger
2014
TerraForm Power IPO
Financing (yieldco) / IPO
2015
TerraForm Global IPO
Financing (yieldco) / IPO
2015
Vivint Solar Deal and Collapse
Acquisition (failed)
2016
Chapter 11
Restructuring or bankruptcy
2017
Brookfield Buys the Yieldcos
Acquisition (by a third party) / restructuring