TerraForm Global (NASDAQ/GLBL) IPO: What Investors Need to Know

TerraForm GlobalTerraForm Global Inc. (NASDAQ/GLBL) recently submitted a filing to the Securities and Exchange Commission about its upcoming initial public offering (IPO). Here’s what you need to know about the upcoming TerraForm IPO. (Source: Securities and Exchange Commission, July 20, 2015.)

Who is TerraForm Global?

TerraForm Global is a renewable energy company spun out from solar giant SunEdison, Inc. (NYSE/SUNE). The new firm is structured as a “yieldco,” which in many ways mimics the master limited partnerships that are popular in the oil and gas sector. Because these properties tend to generate stable dividend income, investors are willing to pay a premium for these assets as standalone entities.

TerraForm Global has 42 solar, wind, and hydro projects in Asia, Africa, and Latin America. The total combined capacity of those projects tops 1.4 gigawatts. TerraForm Global expects these projects to generate $231.5 million in cash available for distribution in 2016.

The company is also acquiring more assets. In the remainder of 2015, TerraForm Global expects to acquire 921.7 megawatts of projects from third parties.

The power purchase agreements for projects of TerraForm Global have a weighted average remaining life of 19 years.

What is TerraForm Global’s Revenue?

For the first three months of 2015, TerraForm generated pro forma revenue of $112.7 million.

Would TerraForm Global Pay a Dividend?

TerraForm Global plans to pay regular quarterly cash dividends to Class A shareholders. The initial quarterly dividend would be set at $0.275 per share ($1.10 annually). The company intends to grow its cash dividend in a consistent and long-term sustainable way. For the first three years after the IPO, TerraForm Global plans to grow its dividends at a compound rate of 20% annually.

What is TerraForm Global’s IPO Price?

TerraForm Global plans to float its shares at a price range of $19.00 to $21.00 a share.

How Much Money Will TerraForm Global’s IPO Raise?

TerraForm Global plans to issue 56.6 million shares. At a share price between $19.00 and $21.00 apiece, the IPO would raise $1.13 billion at midpoint.

How Will TerraForm Global Use the Money?

The company plans to use all the proceeds from the IPO to buy newly issued Class A units of Global LLC, a 33.5% of Global LLC’s outstanding membership units.

What is TerraForm Global’s Stock Symbol?

TerraForm Global plans to list its Class A common shares on the NASDAQ Global Select Market under the ticker symbol “GLBL.”

What is TerraForm Global’s IPO Date?

TerraForm Global is expected to go public on Friday, July 31, 2015.