By Cassandra Sweet
California solar-panel installer SolarCity Corp. said Monday that it plans to file for an initial public offering.
The San Mateo, Calif., company said it filed confidential draft registration documents last week with the Securities and Exchange Commission. It was unclear when the company planned to file public registration documents and when it plans to go public.
A SolarCity spokesman declined to provide details beyond a brief prepared statement.
The filing comes at a time of great strain for solar-panel manufacturers, as prices and profits have plunged amid a global oversupply of panels and relatively weak demand.
Investors and solar-panel installers such as SolarCity have fared much better as they've been able to take advantage of federal and state government subsidies, like tax credits, while prices for solar panels and other equipment have cut development costs. However, the bankruptcy last September of California solar-panel maker Solyndra LLC, which spent more than $500 million in federal clean-energy loans, led to political controversy over government support for renewable energy firms, which has created uncertainty about future subsidies.
As the majority of global demand for solar power has relied on government subsidies, which have declined, stock-market investors have viewed solar firms with caution.
California solar-thermal power developer BrightSource Energy Inc. cancelled a planned IPO earlier this month over tepid interest from stock market investors. BrightSource uses a different technology than solar panels.
Signs that the IPO market was turning away from alternative-energy companies emerged in late March, when Enphase Energy Inc. (ENPH), which makes electrical inverters for solar-panel systems, proceeded with its IPO, but had to sell its shares for half their initial target price. Enphase sold nearly 9 million shares for $6 each, down from the company's earlier price range of $10 to $12.
SolarCity equity investors include Draper Fisher Jurvetson, DBL Investors, Generation Investment Management LLP, Silver Lake Kraftwerk and Valor Equity Partners, among others. Elon Musk, founder of Paypal, SpaceX and Tesla Motors Inc. (>> Tesla Motors Inc), where he is chairman and chief executive, also has invested in SolarCity, where he serves as chairman. Musk also has family ties with the solar firm as a cousin of SolarCity co-founders and brothers Lyndon Rive, chief executive, and Peter Rive, chief operational officer and chief technology officer.
SolarCity has raised hundreds of millions of dollars in investment financing for solar-power projects from U.S. Bancorp (USB), Rabobank, Google Inc. (>> Google Inc), Citigroup Inc. (>> Citigroup Inc.) and other investors.
Founded in 2006, SolarCity says it has more than 30,000 solar-power projects completed or under development in Arizona, California, Colorado and other states.
-By Cassandra Sweet, Dow Jones Newswires; 415-439-6468; [email protected]