The deal will have Sunrun offering RUN shares in exchange for VSLR shares. This will have VSLR stockholders receiving .55 shares of RUN stock for each share of VSLR stock that they hold. That has the total value of the deal sitting at $9.2 billion based on the closing price of RUN stock on Monday.
The offer from Sunrun has it putting a 10% premium on VSLR stock based on closing prices from Monday. It’s also a 15% premium over VSLR stock’s three-month volume-weighted average price.
This deal will have holders of RUN stock owning 64% of the company once it reaches completion. The remaining 36% of shares will belong to former owners of VSLR stock.
According to a news release, the solar energy companies will benefit from annual cost synergies of $90 million once the acquisition is complete. It will also have Sunrun expanding its Board of Directors with two new members. One of these will likely be Vivint Solar CEO David Bywater.
Lynn Jurich, co-founder and CEO of Sunrun, said this about the deal.
“This transaction will increase our scale and grow our energy services network to help replace centralized, polluting power plants and accelerate the transition to a 100% clean energy future.”
Sunrun and Vivint Solar note that the deal has the unanimous approval of both companies’ Boards of Directs. So long as other customary closing conditions don’t present a problem, the deal will close in Q4 2020.
RUN stock was up 24.1% and VSLR stock was up 39% as of Tuesday afternoon.
As of this writing, William White did not hold a position in any of the aforementioned securities.