Verengo, Inc. announced on September 23rd the proposed sale of substantially all of its assets to Crius Solar Fulfillment LLC, a subsidiary of Crius Energy Corporation and an affiliate of Crius Energy, LLC, a major energy solutions company that provides electricity, natural gas and solar products to residential and commercial customers. Closing of the transaction is subject to customary conditions including approvals required by the Verengo Chapter 11 bankruptcy process. The sale will be subject to other bids that may be received.
The combination with Crius is expected to significantly strengthen Verengo's capabilities in the California residential solar energy segment and provide an expansion platform outside of California. By leveraging Crius' scale and longstanding industry relationships, Verengo also expects to further improve its market-leading cost competitiveness and service opportunity adjacencies.
"The acquisition by Crius provides Verengo with access to an exceptional customer platform, reliable infrastructure and capital that position us to grow from our standing as a premier California residential solar provider to an industry leader nationwide," said Dan Squiller, chief executive officer of Verengo. "As the solar industry continues to consolidate, the scale and resources that Crius brings to Verengo will increase our reach to new customers and strengthen our ability to serve our existing customers well into the future."
Verengo intends to implement the transaction as an asset sale under Section 363 of the U.S. Bankruptcy Code. Verengo has commenced voluntary Chapter 11 proceedings in the U.S. Bankruptcy Court for the District of Delaware to facilitate the process, which will provide for an orderly sale of its assets in a court-supervised environment. In conjunction with the proposed transaction, Crius has committed to provide Verengo with "debtor-in-possession" financing, to support the company's continued operations during the sale process. In addition, Verengo has filed a number of customary motions to facilitate ongoing operations.
"Crius is pleased to make this initial bid to facilitate an orderly transition that will enable Verengo to achieve its full potential, strengthen the company's balance sheet and support its customers without interruption," said Michael Fallquist, chief executive officer of Crius Energy. "Verengo has a proven track record of providing industry-leading service and quality for customers and partners including EPC, 3PO, and home builders. We are confident that by leveraging synergies between both companies, we can further strengthen Verengo's market position in the California solar residential market, and expand the Verengo business into exciting new services and geographies."