Brookfield proposes takeover of TerraForm Power


We have reached the inevitable moment in the collapse of SunEdison when various parties began to compete for the most valuable portion of the company’s empire: yieldco TerraForm Power.

Yesterday Brookfield Asset Management (NYSE: BAM) revealed in a regulatory filing that it has proposed to independent members of the board of TerraForm Power (NASDAQ: TERP) to either replace SunEdison as the yieldco’s sponsor, or to buy the company outright. Later Hedge Fund Manager David Tepper’s Appaloosa Management also revealed in a regulatory filing that it is working with Brookfield.

Under the proposal to replace SunEdison as TerraForm’s sponsor, Brookfield would purchase shares from existing stockholders, and under the other option the asset manager would buy 100% of TerraForm Power for cash. Brookfield and affiliated companies already own a significant portion of TerraForm’s shares.

This is not the first bid for TerraForm Power. Brookfield and Appaloosa had mad previous bids to take over the yeildco, which failed. Additionally two weeks ago D.E. Shaw made a bid to replace SunEdison as TerraForm’s sponsor.

The filing notes that no agreements were made at the meeting with TerraForm and no specific prices were discussed, but that TerraForm is considering the two options “on the basis of public information and in light of the current market prices of the TerraForm Companies”

Brookfield is considering buying TerraForm or both TerraForm Power and TerraForm Global, but notes that any plans to buy Global hinge on the successful acquisition of TerraForm Power.

This discussion also comes as TerraForm has released details of its offer to settle its claims against SunEdison, with both companies agreeing that a collaborative settlement is preferable to litigation.


Update: This article was modified at 5 PM EST on Nov. 10 to report that Appaloosa is working with Brookfield, following a regulatory filing by the former company.

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