SunEdison CEO Promises Cash Flows to Calm Investors by 2016

Updated on
  • SunEdison's mounting losses scared some investors, CEO says
  • Chief Executive Officer Ahmad Chatila defends Vivint buy

SunEdison Inc. Chief Executive Officer Ahmad Chatila has a message for investors who dragged the stock down more than 50 percent in a single month: The cash is coming.

The largest renewable energy developer expects to continue losing money as it invests in new projects around the world and then sells them to two yield companies Chatila controls. SunEdison’s portion of the cash generated by these companies selling power under long-term contracts will begin to flow as early as the end of this year, the CEO said in an interview Wednesday.

“The most important question for investors is when do we start generating cash for a living,” Chatila said at SunEdison’s office in Belmont, California. “I have said it’s at the end of 2016 or early 2017. But we’ve been signaling it’s going to be a lot sooner than that, probably early 2016 or late 2015.”

Concerns that continuing losses will limit SunEdison’s ability to raise cash for future projects helped drive the shares down 55 percent in August. Some investors saw that as a threat to Chatila’s planned acquisition of Vivint Solar Inc., the second largest residential rooftop supplier and key to SunEdison’s growth. SunEdison rebounded 11 percent Thursday to $11.94 at the close in New York, the biggest gain since May.

SunEdison shares have plunged 54 percent in past month on concerns over the company's ability to raise cash.
SunEdison shares have plunged 54 percent in past month on concerns over the company's ability to raise cash.

“We came late into residential and to compete you really have to have scale,” Chatila said. He declined to comment on speculation that the stock drop may scuttle the deal except to indicate that he expects it to close as planned in the fourth quarter. “I’m very enthusiastic about the Vivint team.”

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