Vivint Solar has terminated a recent merger agreement with renewable energy company SunEdison Inc. following what it says is “a willful breach” of the contract agreement.
According to a release, Vivint sent a notice to SunEdison on Monday night explaining that it failed to consummate the merger when required pursuant to the terms of the agreement – and consequently, the merger has been cancelled.
SunEdison signed the agreement to acquire Vivint Solar for approximately $2.2 billion, payable in a combination of cash, shares of common stock and convertible notes, back in July 2015. Per the merger, Vivint Solar was to be folded into SunEdison’s existing residential and small commercial development business, and Vivint’s management team was to integrate within SunEdison’s ranks.
In addition to canceling the merger, Vivint’s notice stated that the company reserves all rights under the merger agreement and, further, it intends to seek all legal remedies available.
SunEdison has faced a number of troubles as of late, including another failed acquisition.
Last year, SunEdison entered into a deal to acquire Latin America Power Holdings for about $700 million, but the renewable energy company reportedly backed out of the agreement. SunEdison recently settled the resulting lawsuit against Latin America Power shareholders for $28.5 million.
On Tuesday, Vivint Solar announced that it has commenced an action in the Court of Chancery of the State of Delaware suing SunEdison Inc. over its breach of the merger agreement. Among other things, Vivint Solar is seeking damages for the benefits its stockholders expected in connection with the transaction.
Gregory Butterfield, president and CEO of Vivint Solar, stated, “SunEdison has willfully breached its obligations under the merger agreement, and we intend to pursue Vivint Solar’s remedies vigorously.”
