Stock Update (NYSE:SUNE): Sunedison Inc Secures $300 Million In New DIP Financing

Sunedison Inc (NYSE:SUNE) announced that it has commenced a process to restructure its balance sheet and position the Company for the future.  To facilitate this restructuring, SunEdisonand certain of its domestic and international subsidiaries have filed voluntary petitions for reorganization under chapter 11 of the U.S. Bankruptcy Code in the Bankruptcy Court for the Southern District of New York.

SunEdison’s publicly-traded yieldcos, TerraForm Power (NASDAQ:TERP) and TerraForm Global (NASDAQ:GLBL), are not part of the filing.

“Our decision to initiate a court-supervised restructuring was a difficult but important step to address our immediate liquidity issues,” saidAhmad Chatila, SunEdison chief executive officer. “The court process will allow us to right-size our balance sheet and reduce our debt, providing the opportunity to support the business going forward while focusing on our core strengths. It also will facilitate our continued work towards transforming the Company into a more streamlined and efficient operator, shedding non-core assets as well as taking other steps to help us get the most value out of our technological and intellectual property. As a result of this process, we expect that SunEdisonwill be in an even better position over the long term to utilize our capabilities in the renewable energy sector in service of our customers, business partners, and employees.”

SunEdison has secured commitments for new capital totaling up to $300 million in debtor-in-possession (DIP) financing from a consortium of first and second lien lenders. Subject to Court approval, these financial resources will be made available to the Company to support its continuing business operations, minimize disruption to its worldwide projects and partnerships, and make necessary operational changes.

The new financing will support day-to-day operations during the reorganization, including:

  • Proceeding with work on ongoing projects, both in the U.S. and elsewhere;
  • Paying wages and benefits for employees;
  • Continuing to provide services to customers;
  • Paying vendors and suppliers in the ordinary course for goods and services provided on or after the date of the chapter 11 filing; and
  • Complying with all regulatory obligations.

SunEdison has made customary filings, including first day motions, with the Court, which, if granted, will help ensure a smooth transition into chapter 11 without business disruption.  The motions are expected to be addressed by the Court promptly following the filing, and include, among other things, a request for approval of the debtor-in-possession financing, as well as requests for authority to make wage and salary payments, continue various benefits for employees, honor certain customer programs, and other relief in order to continue the day-to-day operations of SunEdison. (Original Source)

Shares of SunEdison are trading flat on Tuesday. SUNE has a 1-year high of $33.45 and a 1-year low of $0.20. The stock’s 50-day moving average is $1.12 and its 200-day moving average is $3.81.

On the ratings front, SunEdison has been the subject of a number of recent research reports. In a report issued on April 5, Needham analyst Edwin Mok maintained a Hold rating on SUNE. Separately, on April 1, Robert W. Baird’s Ben Kallo reiterated a Hold rating on the stock .

According to, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Edwin Mok and Ben Kallo have a total average return of 2.2% and 6.0% respectively. Mok has a success rate of 56.4% and is ranked #952 out of 3827 analysts, while Kallo has a success rate of 54.1% and is ranked #554.

The street is mostly Neutral on SUNE stock. Out of 13 analysts who cover the stock, 9 suggest a Hold rating , 2 suggest a Sell and 2 recommend to Buy the stock. The 12-month average price target assigned to the stock is $1.61, which implies an upside of 377.5% from current levels.

SunEdison, Inc. engages in the business of semiconductor and solar technology. It develops, manufactures, and sells silicon wafers and photovoltaic energy solutions. It operates through the Semiconductor Materials, TerraForm Power, Inc. and Solar Energy segments. The Semiconductor Materials segment includes the development, production, and marketing of semiconductor wafers, which are utilized in the manufacture of semiconductor devices. The Solar Energy segment provides solar energy services that integrate the design, installation, financing, monitoring, operations and maintenance portions of the downstream solar market. 

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