Summary
Bloom Energy Corporation (BE) announced a significant financial transaction related to its PPA IIIb project, which involves its fuel cell electricity generators, also known as Energy Servers. On November 27, 2019, Bloom acquired full indirect ownership of the project company responsible for the PPA IIIb project by buying out existing debt and equity investors. This move consolidated control and simplified the project's financial structure. Subsequently, Bloom upgraded 5.4 megawatts of existing Energy Servers within this project. The company also entered into a sale-leaseback agreement with Key Equipment Finance, a division of KeyBank, to finance these upgrades. This transaction is expected to generate approximately $26.2 million in net cash proceeds for Bloom after accounting for the debt buyout and the sale of new Energy Servers. This deal leverages Bloom's existing relationship with KeyBank, which has previously financed a substantial amount of Bloom's Energy Server capacity.
Key Highlights
- 1Bloom Energy has fully acquired indirect ownership of its PPA IIIb project company by buying out existing debt and equity investors.
- 2The company upgraded 5.4 megawatts of existing Bloom Energy Servers within the PPA IIIb project.
- 3A sale-leaseback transaction with Key Equipment Finance (KeyBank) was executed to finance the upgrades.
- 4The transaction is expected to yield approximately $26.2 million in net cash proceeds for Bloom Energy.
- 5Outstanding project debt of approximately $24.2 million plus swap breakage costs was repaid.
- 6$20.0 million of the proceeds are pledged for seven years to secure Bloom's operations and maintenance obligations with KeyBank.
- 7The pledged funds can be released early if Bloom meets certain credit rating and/or market capitalization milestones.