Sunnova to buy Lennar’s residential solar platform for homebuilders

Sunnova Energy International Inc (NYSE:NOVA) has struck an all-stock deal to acquire the SunStreet residential solar platform of homebuilder Lennar Corporation (NYSE:LEN; NYSE:LEN.B).

The deal comes with a multi-year strategic partnership under which Sunnova will become Lennar’s exclusive residential solar and storage service provider. The cooperation will focus on the development and rollout of innovative energy technologies, such as home storage and community microgrids, through Len X LLC (LENX), a technology focused subsidiary of Lennar. LENX has committed to provide tax equity investments to support Sunnova’s homebuilder customer pipeline.

Under the terms of the acquisition agreement, LENX will receive a total of 7.22 million Sunnova common shares, including two milestone-based earn-outs of up to 3.89 million shares. The transaction is expected to close next quarter, subject to regulatory clearance.

The acquisition will provide Sunnova with a captive pipeline and upsell opportunities, while also reducing customer acquisition cost.

“This agreement will allow Sunnova to increase customer growth, further scale the business, and develop smart microgrids for communities across the US,” commented William Berger, CEO of Sunnova.

On the other hand, Lennar’s executive chairman Stuart Miller views this transaction as a long-term investment in Sunnova.

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