SunEdison, Inc. (NYSE: SUNE), announced today that it is reviewing strategic alternatives of different company structures as a sponsor in a long term asset ownership platform (yield company or yieldco) through its TerraForm platform.
Although owned by SunEdison, TerraForm Power has independent status and mimics the Master Limited Partnerships (MLP) that are common in the oil and gas sector. Master Limited Partnerships are similar to real estate investment trusts in that they do not pay income taxes, and their shares trade on the major stock exchanges just like regular stocks.
The Company has stated that it is considering a range of alternatives with a goal of driviving greater value and enable the efficient return of capital to shareholders, while maximizing its growth opportunities. The tax benefit of the MLP structrue would seem to tick all of these boxes.
“Given the transformative activities that we have undertaken over the past year, including accelerating the value of SunEdison’s IDRs in TerraForm Power and progress growing the TerraForm platform, a thorough review of the Company structure is deemed prudent given our transition into a sponsor of long-term asset ownership vehicles,” said Ahmad Chatila, President and Chief Executive Officer of SunEdison. “This review is part of our strategic effort to more effectively position the company to maximize shareholder value.”
SunEdison expects to conclude the strategic review by the end of the year. Below is a video that was done to introduce TerraForm Power when it was launched.
Tracey is an accountant and entrepreneur with a passion for nature. This passion is what spurred her interest in renewable energy, and the rest is history as they say. Tracey is a principal in Energy Think Group, the publisher of Solar Thermal Magazine and Tek-Think. She is also the principal at Women's Financial Help Desk. She spends her free time in the outdoors with her horses and dogs. She loves to travel.