SunEdison (SUNE) Warehouse Facility Addresses Liquidity Concerns, Baird Says

Baird analyst Ben Kallo reiterating a Neutral rating and $35 price target on SunEdison (NYSE: SUNE) after the company announced a construction warehouse facility providing $1B of liquidity, which will help SUNE complete projects in 2016. The facility will address liquidity concerns.

Kallo commented, "This facility will be helpful in executing on SUNE's development of projects during 2016. The warehouse facility consists of $300M of equity committed by West Street Infrastructure Partners III (WSIP) of Goldman Sachs (GS; Not Covered) and $700M of debt led by Bank of America (BAC; Neutral), Morgan Stanley (MS; Not Covered), and Deutsche Bank (DB; Not Covered). The debt includes a five-year $500M term loan, and a four-year $200M revolving credit facility. Additionally, SUNE has the option to increase the warehouse facility by up to $1B (to ~$2B total). The warehouse is expected to be formed by October 31, 2015."

SUNE also announced the offering of $500M of perpetual convertible preferred stock, which provides additional liquidity but makes the capital structure more complex.

For an analyst ratings summary and ratings history on SunEdison click here. For more ratings news on SunEdison click here.

Shares of SunEdison closed at $14.68 yesterday.

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