One of the market's most notoriously yo-yoing stocks, SunEdison (SUNE), went up as high as 22% in Friday pre-market trading, after settling a legal dispute. Shares plunged 15% on Thursday,
On Friday, the Missouri-based renewable energy company announced it resolved "all of the disputes" tied to its failed acquisition of Latin American Power Holdings. As part of the settlement, SunEdison will have to pay $28.5 million to LAP in installments over the next year. None of the involved parties admitted wrongdoing tied to the claims. SunEdison's yieldco, TerraForm Power (TERP), is not responsible to make the payments, according to a statement from SunEdison released Friday.
The case was filed in a New York Supreme Court earlier this year. According to court documents, SunEdison and LAP entered into a purchase agreement on May 19, 2015. The LAP acquisition was intended to be financed in part by the IPO of another of SunEdison's yieldcos, TerraForm Global (GLBL).
Court documents say the transaction was expected to begin closing on Sept. 23, 2015, but the expected wire payments never came. LAP, along with other petitioners, allege SunEdison "willfully breached" its purchase agreement with LAP and "failed to satisfy its payment obligations." The petitioners sought damages from SunEdsion for no less than $150 million.
Last month, a New York judge issued a temporary restraining order on SunEdison and TerraForm Power, that blocked the company from "concealing, transferring or removing their assets, accounts or other property" without "fair consideration" in order to protect an "eventual international arbitration award" against SunEdison, court documents stated. As part of the settlement, SunEdison requested that the restraining order be vacated, according to a filing with the Securities and Exchange Commission.
This is one legal headache SunEdison has out of its way, but its lawsuit with David Tepper's Appaloosa Management is still ongoing. This suit is tied to SunEdison's plans to acquire Vivint Solar (VSLR), which Appaloosa believes is unfair to TerraForm Power as it requires the yieldco to finance part of the transaction, and acquire some of Vivint Solar's solar projects, which are percieved to be less credit-worthy.