iSun Completes Acquisition of SunCommon

Source: www.gulfoilandgas.com 10/4/2021, Location: North America

iSun, Inc., a leading solar energy and clean mobility infrastructure company with 50-years of construction experience in solar, electrical and data services, announced that it has completed its acquisition of SunCommon, pursuant to the terms previously announced on September 8, 2021.

HIGHLIGHTS:
• Creates a regional full-service solar installation leader servicing the residential, commercial, industrial and utility-scale markets as well as the growing demand for the electric vehicle charging infrastructure.
• Positions combined company to effectively capitalize on emerging opportunities in the residential and small commercial landscape.
• Leverages brand and marketing expertise of SunCommon to effectively grow presence and message in new regional markets.
• Transaction consideration to SunCommon shareholders includes approximately $25,534,621 in cash and an aggregate of 1,810,915 shares of ISUN shares of Common Stock of iSun; provides for the future distribution of $2.5 million directly to SunCommon employees, expands eligibility under the Company’s Equity Incentive Plan to all iSun employees, and provides for $1.5 million working capital infusion into SunCommon, now a wholly owned subsidiary of iSun Residential, Inc.
• Anticipated to be accretive to earnings as a result of increased combined revenues and net income as of Q4 2021.
• Alignment of software, shared services and vendor base will enable synergies with expected $1.25 million in savings in year-1 and provide opportunities to reduce customer acquisition costs across all business segments.

The transaction executes phase one of iSun’s recently announced East Coast residential strategy and builds on iSun’s commercial, industrial and utility-scale presence in Maine, New Hampshire, Vermont, Connecticut, Massachusetts, Rhode Island, New York, Maryland, North Carolina and South Carolina. The acquisition furthers iSun’s ability to both drive the transition from dirty to clean energy and capitalize on the increasing focus on the climate crisis. The combined organization on a pro forma basis generated net revenues of approximately $51.4 and $70.0 million in calendar years 2020 and 2019, respectively. SunCommon’s anticipated positive EBITDA will enhance the Company’s overall EBTIDA. Management estimates year-1 SG&A synergies to be approximately $1.25 million related to integration of backend software and implementation of a shared services platform consisting of administrative related functions (finance, IT, software), while the differing revenue cycles of the two business will improve cash-flow.

“The electrification of everything – automobiles in particular - is going to rapidly accelerate energy demand across all sectors,” stated Jeffrey Peck, iSun Chairman and Chief Executive Officer. “With this acquisition, iSun is perfectly positioned (has the perfect partner) to address this opportunity across the residential sector with a partner who has built a scalable residential platform with best-in-class capabilities, industry leading customer acquisition cost of $0.36/Wdc, and most important – who shares our values. We’re excited to help enhance their capabilities as we progress to phase two of our residential strategy.”

Transaction Details.
Both iSun and SunCommon’s respective Boards of Directors unanimously approved the Definitive Agreement, which includes a cash payment of $25,534,621 and 1,810,915 shares of common stock (approximately $2.5 million of the consideration will be distributed to SunCommon employees), $1.5 million working capital infusion and additional earnout provisions, subject to customary purchase price adjustments and customary seller representations and warranties and indemnification obligations.

In 2020, SunCommon generated approximately $33.1 million in revenue with gross margins of approximately 30.2% and maintained customer acquisition costs well below those advertised by other residential solar market leaders.

Mr. Peck will serve as the CEO of the combined organizations, and Mr. Peterson and Mr. Moore will continue to serve as co-Presidents of SunCommon. The existing iSun Board of Directors will remain as currently established.

B. Riley Commercial Capital, LLC provided a $10 million secured loan to the Company, which allowed the Company to take advantage of its low debt to equity ratio and preserve shareholder value for the transaction.


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