TerraForm Power Inc (TERP.O), the "yieldco" of bankrupt solar company SunEdison Inc (SUNEQ.PK), said it would sell some UK solar projects to Vortex, the renewable energy investment platform of Egypt's EFG Hermes (HRHO.CA), for about $580 million.
Shares of TerraForm Power were up 3.3 percent at $13.5 in early trading.
TerraForm Power and TerraForm Global Inc (GLBL.O), the other yieldco of SunEdison, said in September they were exploring strategic alternatives, including a sale of their entire business.
TerraForm said on Friday its unit, TerraForm Power Operating LLC, would sell 24 operating solar projects representing 365 megawatts (MW).
TerraForm Power Operating expects to receive about $208 million of proceeds from the sale, net of expenses and other adjustments.
The deal proceeds will be used to pay down its net debt, TerraForm Power said. The company had long-term debt and financing lease obligations of $2.53 billion as of March 31.
TerraForm Power, which expects the deal to close in the first half of 2017, will continue to own an 11 MW operating solar plant in the UK, which it expects to divest in the future.
"Yieldcos" are publicly traded subsidiaries that hold renewable energy assets, including assets bought from their parents or sponsors.
The two yieldcos were not part of SunEdison's bankruptcy in April and the companies said at the time that they had sufficient liquidity to operate and that their assets were not available to satisfy the claims of SunEdison's creditors.
Citi was TerraForm Power's financial adviser and Linklaters, LLP its legal counsel. Watson Farley & Williams acted as legal counsel to Vortex.
(Reporting by John Benny in Bengaluru; Editing by Maju Samuel)