BlackRock Said to Consider Bidding for SunEdison Yieldco

  • TerraForm Power said earlier this week it’s seeking buyer
  • Brookfield, Appaloosa, Golden Concord have also shown interest

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.

Funds of the New York-based firm are assessing the value of TerraForm Power’s assets to prepare for a bid, according to two people who asked not to be named because the matter is private. TerraForm Power, along with sister company TerraForm Global Inc., own wind and solar assets, some of which are operated by SunEdison. Both said earlier this week that they seek to sell their entire businesses, or operate independently.

TerraForm Power increased 4.5 percent to $14.00 at the close in New York. The Bethesda, Maryland-based company has a market value of $1.95 billion.

The two so-called yieldcos are not in bankruptcy, and SunEdison owns a controlling stake in TerraForm Power through Class B shares. SunEdison, which has been selling off assets in Chapter 11, said earlier in September that it had reached an agreement with TerraForm Power and TerraForm Global over when and how they would bring claims as part of the bankruptcy.

BlackRock Ownership

BlackRock owned 5.3 percent of TerraForm Power’s Class A shares as of June 30, according to data compiled by Bloomberg.

Representatives for TerraForm Power and BlackRock declined to comment, and a spokesman from SunEdison didn’t immediately return calls for comment.

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. Golden Concord Holdings Ltd., a Chinese clean-energy group, has also expressed interest in the unit.

“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 New York, said in an e-mail Wednesday. “That is, provided it’s priced reasonably.”

The two yieldcos said earlier this week that they were working closely with SunEdison on alternatives. Decisions such as how the bankrupt company would vote its shares in TerraForm Power to approve a sale would require approval of the U.S. Bankruptcy Court, they said.

BlackRock Portfolio

BlackRock, which has $4.89 trillion under management, oversees one of the world’s largest clean-energy investment platforms, with 2.1 gigawatts in wind and solar projects in the U.S., Canada, Ireland, Sweden, France and the U.K. as of June. It has stakes in several U.S. wind farms, including the 211-megawatt Grandview wind farm in Carson County, Texas.

TerraForm owns 3 gigawatts of wind and solar farms in the U.S., Canada, Chile and the U.K., according to a company presentation Sept. 16.

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