8point3, the yieldco formed by First Solar and SunPower, has raised $420 million in an initial public offering on Nasdaq.
Bloomberg reports that 8point3 sold 20 million shares at $21 each, the high end of its projected pricing range, and may sell an additional 3 million shares to the deal’s underwriters within 30 days.
The company said on June 10 that it was seeking to raise as much as $483 million from the IPO.
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Goldman Sachs Group and Citigroup led the offering, joined by Deutsche Bank, JPMorgan Chase, and Credit Agricole. Proceeds from the IPO will be used for cash distributions to First Solar and SunPower and for general corporate purposes, including future acquisitions, according to the statement.
8point3 is the first yieldco to be created by large-scale solar players in the US solar energy market. The number of yieldcos is on the rise as companies are finding it a profitable option.
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The setting up of yieldcos, which typically buy and hold projects, frees development capital for companies and also provide returning dividends tied to long-term contracts to sell electricity.
Ajith Kumar S