The collapse of SunEdison has not spared trouble for its yieldcos, TerraForm Power and TerraForm Global. Due to a high degree of cross-over between the two companies and their bankrupt sponsor, TerraForm Power and TerraForm Global have found themselves in a sticky mess of legal and financial complications.
Four months after SunEdison’s Chapter 11 bankruptcy filing, these issues appear to be coming to a head for both TerraForm Power and TerraForm Global. Neither company has filed a quarterly financial report since Q3 2015 or an annual report for 2015, and the NASDAQ stock exchange warned both TerraForm Power and TerraForm Global again this week that they must come up with a plan to regain compliance with market rules by the end of August, or face de-listing.
This notice comes as TerraForm Global struggles under the weight of massive volumes of litigation. According to a form filed with financial regulators earlier this week, the company could be impacted by more than a dozen legal proceedings, including a request for arbitration by Brazil’s Renova Energía, multiple lawsuits against SunEdison, whistleblower complaints by former directors and former CEO Carlos Domenech Zornoza, which claim retaliatory termination, and lawsuits in India.
Additionally, TerraFrom Global is suing SunEdison and its former executives for alleged failure to transfer equity interests in India projects which the company says that paid $231 million for in the fourth quarter of 2015.