Qcells’ residential solar financing unit raises $253 mn through ABS

Hanwha Q Cells Co., the solar power unit of South Korea’s chemicals-to-defense conglomerate Hanwha Group known as Qcells in overseas markets, said on Tuesday its US residential solar financing subsidiary has raised $253 million by selling its first asset-backed securities (ABS).

The ABS transaction of EnFin Co., a wholly owned subsidiary of Qcells, comprises bonds backed by thousands of consumer loans used to finance residential solar installations, Qcells, the top residential and commercial solar module maker in the US, said in a statement.

RBC Capital Markets acted as the sole structuring advisor and bookrunner, and Santander served as co-manager in the transaction.

ABSs usually help companies reduce fundraising costs as the securities, which are collateralized by an underlying pool of assets, can be issued at relatively lower interest rates.

DIVERSIFIES FINANCING SOURCES

The deal allowed EnFin to stably diversify its fundraising sources for its financing business, said Qcells, the unit of Hanwha Solutions Corp.

“EnFin successfully sold all of the ABS despite the recent tough financing environment with higher interest rates, indicating it secured a financial business structure, which can be operated on its own,” said Qcells CEO Lee Koo Yung.

In addition to the recent ABS transaction, EnFin closed two revolving warehouse transactions totaling $500 million, Qcells said. The first warehouse was closed with RBC in April 2023 and the second with Santander in January 2024, each for $250 million.

EnFin provides financial solutions including installment loans to solar and battery storage installation customers.

The company, officially launched in January 2023, has accumulated approximately 18,000 consumer loan contracts with an aggregate principal balance of more than $800 million.

Write to Hyeon-Woo Oh at ohw@hankyung.com
 
Jongwoo Cheon edited this article.