BoA Is Still Buying Sun Edison

• Sunedison Inc SUNE shares have declined 79.34 percent year to date, with the share price almost touching the 52 week low on November 20.
• Krish Sankar of Bank of America Merrill Lynch has reiterated a Buy rating on the company, while lowering the price target from $15 to $12.
• The company has announced that it has lowered its deal price for Vivint Solar Inc VSLR from $16.50 per share to $15.25 per share.

Analyst Krish Sankar estimates that the total value of the acquisition would come to about $1.9 billion following this amendment, as compared to the earlier $2.2 billion.

“As part of the revised transaction proposal, Blackstone Group LP BX has also committed to provide a $250M credit facility to fund future growth at SunEdison,” Sankar stated, while mentioning that this was a positive development, since it reduces the cash outlay for SunEdison, thereby lowering liquidity concerns.

The renegotiated price for the proposed acquisition also lowers both the per unit and overall cost that would need to be borne by TerraForm Power Inc TERP.

“The announcement also indicated that both SunEdison and Terraform are working to find buyers for both the operating Vivint assets as well as future development,” Sankar added.

The next catalyst for Terraform is likely to be the closing of the Invenerfy deal. Sankar expects the company to provide more insight into third party buyers for the operation and development of Vivint’s assets.