TerraForm Power has acquired 21 distributed generation (DG) solar power plants across the US from SunEdison.
The facilities have a combined capacity of 26MW. TerraForm Power paid $47m for the acquisition.
Located in seven US states, the plants have long-term contracts for an average remaining life of 20 years with multiple counterparties including municipalities, schools, and businesses.
TerraForm president and chief executive officer Carlos Domenech said: "This transaction furthers TerraForm’s leadership in the DG market segment, which is one of the most profitable and fastest growing clean energy market segments."
SunEdison chief financial officer Brian Wuebbels said: "This accomplishment speaks to the strength of the relationship between TerraForm and SunEdison, and our ability to deliver on shareholder commitments by working together to leverage SunEdison’s pipeline and expertise in developing, building, and financing projects.
"The sale of these assets generates immediate value for SunEdison by generating cash, and recurring value through SunEdison’s ownership of TerraForm."
The $47m investment was carried out through cash consideration. This involved $24m tax equity financing, which was secured from Barclays, Citi, and JPM Capital.
It is expected that the new acquisitions will increase TerraForm’s annual cash available for distribution (CAFD) by around $5m on an unlevered basis.