Sunrun prices notes backed by 34,000 home solar systems

US home solar company Sunrun (NASDAQ:RUN) on Wednesday said it has priced a securitisation of leases and power purchase agreements, achieving a lower weighted average cost of capital than any previous transaction.

The notes are backed by 34,068 rooftop solar systems located in 23 states.

The transaction comprises Class A and Class B notes. The Class A notes have an initial balance of USD 447.1 million (EUR 381.6m) and only these notes were sold to inventors. The Class B notes will be retained by an affiliate of Sunrun, with the company planning additional subordinated financing, secured partially by the distributions from the Class B notes.

The Class A notes were priced at a yield of 2.28%, or a spread of 120 bps to the benchmark swap rate. The spread is 15 bps better than the previous record low achieved in Sunrun’s securitisation in March 2021.

The Class A notes have an expected weighted average life of 6.3 years. The anticipated repayment date is January 30, 2029, and the final maturity date is January 30, 2057.

The deal is expected to close on September 29. Deutsche Bank Securities was the sole structuring agent. It acted as a joint bookrunner together with Credit Suisse and BofA Securities.

(USD 1 = EUR 0.854)

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