SunPower sells off shares, debt to raise $400M
It’s been a busy couple of weeks for public solar equipment provider SunPower. In the last five days, the company announced a deal to provide Florida utility-owner FPL Group with 600 megawatts of solar panels, posted surprisingly diminished earnings, and is now selling 9 million shares of common stock and $175 million in convertible debt in an attempt to raise about $400 million.
The San Jose, Calif.-based company says it may sell another 15 percent of its stock and debt if demand for these initial shares is high [Update: This is a misstatement. The company will sell off 15 percent more shares that it is already selling if all goes well]. It has agreed to pay $20 million in costs associated with the convertible-debt hedge and warrant deals, but says it will use the rest of the money raised for capital spending projects.
As reported last week, it looks like SunPower will be okay if it can manage to stay afloat through the downturn. The costs of raw materials for solar equipment are dropping, and government initiatives like the stimulus bill promise more action and high demand in coming months. This recent stock sale is clearly an attempt to bail water from a boat that’s not sinking, but certainly floating a little low for investors’ tastes.
At the time of this post, SunPower’s share price was at $22.57, down another 50 cents from when the story was first published by the Wall Street Journal last night.
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About the Author, Camille Ricketts
Camille is the lead writer for GreenBeat. She came to VentureBeat from Google where she worked on its traditional platforms team, particularly in TV. Before that, she was a reporter for the Wall Street Journal in New York and London. Follow her on Twitter at @camillericketts, and follow VentureBeat on Twitter at @venturebeat.
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