BY Fraser Tennant
Amid rising interest rates, legislative uncertainty and a fragmented capital market, Solar Mosaic, a FinTech platform for sustainable home improvements, has filed for Chapter 11 bankruptcy.
The filing will allow Mosaic to complete a restructuring and recapitalisation supported by a number of its existing lenders, while simultaneously conducting a comprehensive marketing process of its platform and other assets.
With macroeconomic challenges facing the entire residential solar industry, Mosaic determined – in consultation with its board of directors and advisers – that a court-supervised process was the best way to maintain its loan servicing platform, effectuate a full sale and marketing process for its assets, and maximise value for its stakeholders.
“This marks a significant step for Mosaic to address our financial position amid the macroeconomic challenges facing the residential solar industry, as well as the recent legislation passed by the House of Representatives that rolls back residential solar tax credits,” said Patrick Moore, chief executive of Solar Mosaic.
Throughout the process, Mosaic expects to remain fully operational without disruption, committed to working with its network of installers, investors and capital markets partners, and customers. It also plans to maintain its loan servicing operation, ensuring customers can continue to pay their loans as planned and collections are remitted to loan owners.
To that end, Mosaic will receive $45m in debtor-in-possession financing from its existing lenders, including $15m in new money financing which, following court approval, is expected to fund the company’s ongoing operations and administrative expenses during the Chapter 11 cases.
Mosaic has also filed a number of customary motions with the bankruptcy court to ensure that its operations continue as usual during the Chapter 11 process. This includes motions requesting court authority to pay employee wages and benefits, compensate certain vendors and suppliers on a go-forward basis, and facilitate the completion of partially finished installation projects.
Founded in 2010, Mosaic is a pioneer in clean energy lending, providing innovative solutions for financing solar, battery storage and more. The company has funded $15bn in loans to date, helping more than 500,000 households make their homes more sustainable and efficient.
Mr Moore concluded: “Throughout the Chapter 11 process, we remain focused on maintaining stability for our customers, business partners and employees.”
News: Warburg Pincus-Backed Solar Mosaic Files for Bankruptcy