SolarCity Corp. and Zep Solar, Inc., announced on October 9th that they have entered into a definitive agreement for SolarCity to acquire Zep Solar, Inc. for approximately $158 million. The purchase price is payable in shares of SolarCity common stock, and is subject to reduction for the amount of net indebtedness of Zep Solar as of the closing. Zep Solar is one of the providers of residential photovoltaic module mounting systems in the U.S., and has been one of SolarCity’s primary component suppliers for residential systems in 2013. Upon close of the acquisition, Zep Solar will operate as an independent business unit of SolarCity
Zep Solar’s product portfolio works as a comprehensive system that reduces the cost and complexity of designing, shipping, warehousing, and installing PV systems. Its technology has helped SolarCity’s installation crews to double the number of residential systems they can install each day since they began using the product earlier this year. After the close of the acquisition, SolarCity and Zep Solar plan to market and sell Zep Solar products in Australia, Germany, Japan and the United Kingdom.
The transaction is structured as an acquisition of all of the outstanding capital stock of Zep Solar through a merger of Zep Solar with a wholly-owned acquisition subsidiary of SolarCity. The actual number of shares of SolarCity common stock to be issued in the transaction will be based on the final purchase price and the volume weighted average price per share of SolarCity common stock for the ten trading day period prior to the completion of the merger. The transaction is expected to be completed in December, subject to customary closing conditions.
