SunEdison, the world’s largest renewable energy company, has lost 90% of its market cap since last summer. The company on Thursday officially filed for bankruptcy protection.
The company accumulated over $11 billion in debt after acquiring various company’s in the hopes of quickly expanding its business.
SunEdison’s fortunes turned in July when the company attempted to acquire Vivint, a residential solar company, for a 52% premium.
Investors were angered that the company was attempting to purchase Vivint’s lower grad assets, especially at such a high premium.
That attempted deal made investors realize that SunEdison was in a more precarious position then they had originally thought.
Making matters worse at the company, activist investor David Tepper of Appaloosa Management has been on a tear.
Tepper filed a lawsuit against the company. He argues that SunEdison was forcing yieldcos to give up cash to the parent company as part of “take-or-pay” agreements. Under those terms, the yieldcos would have to buy projects from the parent or pay a fee.
The company operates two subsidiaries, TerraForm Global and TerraForm Power. They are meant to work as utilities, managing SunEdison projects and collecting cash.
Troubles really started to mount at SunEdison when the Vivint deal was called off, along with several smaller acquisitions. The company then delayed its annual report which further angered investors.
The SEC soon launched an investigation to determine whether or not the company lied to its shareholders about its cash position.
An internal audit led the the company to admit that it made some accounting mistakes. SunEdison quickly fired the employee it says messed up its financial records.