Spruce Power Holding Corporation a leading owner and operator of distributed solar energy assets across the United States, secures $130 million in debt funding provided by Barings LLC (“Barings”). The New Debt Facility refinances the Company’s term loan of $125 million (the “SP4 Facility”) and provides for a net injection of incremental capital.
Joe Pettit, Spruce’s VP of Corporate Development said, “Spruce is proud to announce the execution and closing of the refinance of its SP4 Facility. This transaction achieves a favorable balance of capitalizing on the Company’s strong asset performance and retention of asset level cash flows for our shareholders, Additionally, I’m pleased to announce a new relationship with Barings, who brings deep industry expertise that is supportive of Spruce’s mission to power our customers’ clean and efficient energy use.”
Burak Cetin, Barings’ Managing Director and Head of Private Residential and Consumer Asset Finance said, “We are pleased to start a great partnership with Spruce to support the Company’s innovative business model and growth trajectory, as we seek to deliver attractive risk-adjusted returns to our clients,”.
The $130 million New Debt Facility was rated A+ by Kroll and priced at a fixed loan rate of 6.889%. The initial balance of the New Debt Facility represents a 69% advance rate of ADSAB (contracted cash flows available for debt service discounted at 6%).
The New Debt Facility’s collateral pool consists of cash flows from over 22,000 solar contracts (the “Spruce Power 4 Portfolio”), the majority of which are variable rate PPAs indexed to retail electric rates of California investor-owned utilities.
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Since its acquisition in March 2023, rapidly rising retail electric pricing in California and other geographies across the Spruce Power 4 Portfolio has resulted in ADSAB accretion, and looking ahead, the Company expects continued strong performance of variable rate PPAs underlying the Spruce Power 4 Portfolio.
About Spruce Power
Spruce Power Holding Corporation is a leading owner and operator of distributed solar energy assets across the United States. They provide subscription-based services that make it easy for homeowners to benefit from rooftop solar power and battery storage.
Their power as-a-service model allows consumers to access new technology without making a significant upfront investment or incurring maintenance costs. Their company owns the cash flows from over 75,000 home solar assets and contracts across the United States.
