How a solar module manufacturer turned around its debt raise with Crux

A solar module manufacturing company was looking to raise debt to finance construction of its new manufacturing facility. After many months of outreach, however, the manufacturer was struggling to identify the right lending party.

From no interest to multiple term sheets

The manufacturer initially approached Crux to discuss monetizing its §45X advanced manufacturing tax credits. During the initial conversations, the manufacturer expressed an interest in raising construction debt financing based on §45X tax credit production and operating cashflows. 

Monetization of clean energy tax credits has quickly emerged as an important tool for developers and manufacturers to raise financing at the start of project construction. In addition, various specialty private credit firms have begun to deploy debt capital based on targeted investment theses in clean energy.

The Crux team quickly realized that they could help the manufacturer to not only monetize its tax credits, but also identify some of these specialty private credit firms and other lenders who might be interested in investing. Crux’s Capital Markets team mobilized and surfaced the investment opportunity with a targeted set of 12 lenders based on discussions with the manufacturer, review of key materials, and a deep understanding of specific lender investment criteria and the broader financing market. 

Within weeks, the manufacturer received two term sheets for consideration. It ultimately executed a multimillion-dollar debt financing term sheet with Legalist, Inc., an alternative investment firm with a fund specializing in financing government payments, including tax credits under the Inflation Reduction Act of 2022. 

More than a matchmaker — support all along the way

Crux supported transaction closing across various phases, including third-party due diligence, documentation standards, and legal precedents. For example, Crux leveraged its network of third-party advisors to help validate that the manufacturer met §45X eligibility requirements and gathered market standards to support documentation negotiation.

“With the resurgence of domestic manufacturing, we see a lot of business and investment opportunities around 45X credits, which we believe are overlooked by the traditional lending community,” says Brian Stout, Investment R&D Lead at Legalist. “We’re eager to be investing in these deals right now, and Crux’s niche market expertise and technology platform provide the highest qualified deal flow and help facilitate efficient deal closures.”

Industry knowledge and connectivity are key to success

Because each financing opportunity varies across a range of factors — including investment amount, sector, and risk profile — lender matching should be based on a deep understanding of lender investment criteria and other requirements. By working with Crux, the manufacturer was able to quickly connect with a specific set of lenders who had the ability to efficiently diligence and execute on a debt financing to meet its construction schedule. 

With more than 600 developers, manufacturers, tax credit buyers, and lenders, Crux provides a central platform by which various parties can connect throughout a project’s development lifecycle. For lenders, Crux actively surfaces unique investment opportunities within predefined investment criteria, significantly reducing the required time and resources to screen transactions. Since launching in 2023, Crux has listed more than $31 billion of tax credits across hundreds of developers with unique financing needs.

To learn more about how Crux can help you plan your capital raises or identify targeted matches that fit your investment criteria, contact us.