Tepper Discloses Stake in TerraForm After Admonishing Board

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Billionaire hedge fund manager David Tepper disclosed a 9.25 percent stake in TerraForm Power Inc. a day after releasing a letter in which he “admonished” the company’s board.

Tepper, through four funds, holds 7.4 million Class A shares of TerraForm Power, according to a filing Wednesday from his Appaloosa Management LP.

Tepper began buying shares on Nov. 11 in a series of transactions and paid a range of $6.92 to $13.86 for his stake through Tuesday, according to the filing.

He is also “exploring potential claims of impropriety” against management of both TerraForm Power and its parent, SunEdison Inc., according to the filing.

Tepper sent TerraForm’s board the letter dated Nov. 25 questioning its independence and seeking additional information about recent transactions between SunEdison and TerraForm. That followed a management shakeup at TerraForm that the company acknowledged led to the immediate resignation of three directors. TerraForm shares climbed the most on record Tuesday after the letter was released.

SunEdison formed TerraForm to buy and operate wind and solar farms, including those developed by SunEdison. The shares have dropped 64 percent since its initial public offering in July 2014, hindering its ability to raise capital to acquire more projects.

One of the Appaloosa funds owns 2.52 million shares in TerraForm, a 3.15 percent stake, based on 80 million Class A shares outstanding.

The second fund has 3.55 million shares, or 4.43 percent. The third owns 642,000 shares, or 0.8 percent, and the last has 690,000 shares, or 0.86 percent.

Gordon Handelsman, a spokesman for both SunEdison and TerraForm, didn’t immediately reply to e-mail and voicemail messages Wednesday.

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