First Solar intends to partner with SunPower for developing solar power JV

Solar power developers First Solar and SunPower are in advanced discussions for a ‘Yield Co’ formation which is expected to boost their solar power assets.

The companies intend to contribute some of their existing solar power generating assets for the new joint venture to be formed.

Time frame for the JV has not been decided yet.

The companies intend to sign the master formation agreement for the JV, following which registration for an initial public offering (IPO) of limited partner interests in the Yield Co will be done with the Securities and Exchange Commission (the SEC).

The decision however will only be implemented after both the companies secures their respective board and regulatory approvals.

‘Yield Co’ formation is common among power companies at present, since it opens up scope for cash flow generation, which can be either be paid out as dividends or reinvested.

Shares for TerraForm Power, an unit of solar power developer SunEdison, have risen 36% till Monday, since its IPO was last filed to secure funds for solar power developments.