Solarplicity Group: IIIQ 2021 Update

Given the small amounts involved, the BDC Credit Reporter’s coverage of Solarplicity Group Limited (aka AMP Solar UK and Solarplicity UK Holdings) will be limited. As of the IIIQ 2021, the only BDC with exposure is Apollo Investment (AINV) which has $13.0mn in debt, preferred and equity invested in Solarplicity UK and a value of only $2.2mn.

The BDC has a long history with Solarplicity dating back to 2015. In FY 2018, AINV booked a realized loss of ($27.1mn) and the total investment at cost – which used to be one of the BDC’s biggest portfolio companies – was reduced from $155mn to $19mn, following a sale of the business. In FY 2020, AINV booked a further ($4.7mn) realized loss on some of the first lien debt left in the company.

As of now, there is $7.4mn in remaining debt at cost that has been non performing since IQ 2020 and has a value of just $2.2mn, down from $2.5mn in the prior quarter. The preferred and common have no value.

We rate the company CCR 5 because of the non performing debt and have no expectation – based on what we can glean – that any recovery is plausible. (Management of AINV has not provided an update on what’s happening at the solar company since 2018).

Given that we don’t cover any investment with a value below $2mn, we’ll probably be dropping Solarplicity to Not Material status shortly.