Solar company signs $100m debt deal with Highbridge

The Diamond Castle Holdings-sponsored company will use the new debt facility to pay back a Prudential Capital loan and to finance new solar projects.  

New Jersey energy company KDC Solar closed on a new $100 million debt investment from Highbridge Principal Strategies. The investment refinanced an existing construction facility KDC Solar had established with the Prudential Capital Group, the private debt arm of insurer Prudential Financial. The new facility also provides capital to construct additional solar projects in New Jersey, the company said in a statement last week.

Prudential Capital provided a senior secured revolving credit facility to KDC in December 2011. The transaction consisted of a private placement by Prudential of $70 million of floating rate promissory notes. The notes financed the construction of various solar projects in New Jersey. The facility was structured to back multiple construction projects simultaneously, as well as allowing the borrower to recycle the debt back into new projects. The Pru loan has now reached maturity and was paid back in full, Alan Epstein, president at KDC, told PDI.

“The completion of this investment further strengthens our ability to support our portfolio of operating solar projects as well as to build additional solar projects in 2016.  We appreciate Highbridge Principal Strategies's confidence in KDC Solar's team and our ability to build, own and operate solar projects that provide lower cost clean electricity,” Hal Kamine, KDC's chief executive, said in a statement.  “Coupled with our equity support from Diamond Castle, we're further poised to execute upon our plan to construct additional ‘behind-the-meter’ solar power systems for businesses, governments and institutions, which creates and preserves long-term jobs for New Jersey,” he added.

Diamond Castle Holdings, a New York-based private equity fund has invested $225 million of equity into KDC Solar. Headquartered in Bedminster, New Jersey, the company operates 50 megawatts of ‘net-metered’ solar facilities at 11 different locations and is developing 65 megawatts of ‘net metered’ solar projects.  

The sponsor, Diamond Castle, has around $1.8 billion of capital under management. 

KDC Solar was represented by law firm McCarter & English, while Highbridge was advised by Schulte Roth & Zabel.

Highbridge Principal Strategies is the dedicated private credit arm of Highbridge Capital, which is owned by JPMorgan. The debt business is shortly planning to spin-out via a management buyout.