Staff from SolarZero, owned by US private equity giant BlackRock have been dealt a crushing blow after the company's shock liquidation.
Video / NZ Herald
The first liquidator’s report on SolarZero reveals the company owes more than $40 million to more than 700 creditors and staff.
Russell Moore and Stephen Keen of Grant Thornton were appointed liquidators of the six entities – all in liquidation – that made up the Group.
The reason for SolarZero’s collapse was due to it being unable to generate a profit – nor did it reach breakeven, the liquidators said.
The company had 169 staff at the time of liquidation. The liquidators said they are aware of 173 preferential claims totalling $1,796,880, representing holiday pay owing to employees for accrued entitlement.
The liquidator’s report also confirmed BlackRock had bought SolarZero for $110m from its Kiwi founders in a mid-2022 deal.
The price has not been previously disclosed, but the deal required Overseas Investment Office approval, implying it was above the OIO’s $100m assessment threshold.
Since the acquisition, BlackRock has injected a further $147.8m into the business, the report said.
Last week the company said its customers – of which is estimated to be 15,500 – would not be affected by the liquidation.
The liquidator’s report said SolarZero’s cash generating assets, and associated obligations, including most of its contracts with its customers, were legally transferred into special purpose trusts controlled by Public Trust.
“This means that the majority of the Group’s SolarZero customers are not creditors of any of the companies.”
The SPVs are not in liquidation. The Public Trust has been quoted as saying “The trusts continue to operate as a going concern and are focused on ensuring services continue for customers”.
The first report says: “The Liquidators understand that SZL [SolarZero Limited] had underwritten certain aspects of the securitisation, resulting in unsustainable regular payments to the SPVs.”
The liquidators said since their appointment they have received expressions of interest from parties seeking to buy all or part of the SolarZero business.
“We are keeping an interested parties register and we are working to develop options for a possible sale with all other stakeholders,” they said.
Ex-staff protested outside BlackRock's Auckland office last Friday. The group claimed the US private equity giant - which bought SolarZero in mid-2022 - owed them close to $4m in notice-period and holiday pay. Photo / Dean Purcell
On Friday about a dozen former staff protested outside BlackRock’s Auckland office, claiming they were owed $1.4m in holiday pay and $1.6m for one-month notice pay.
“We also have about $300,000 outstanding with our contractors. And then our subcontractors - our field service providers around the country - are owed in total around $600,000,” one of the protest organisers told the Herald.
Such sums were “chump change” for BlackRock, he said.
Master Electricians chief executive Alexandra Vranyac-Wheeler said 14 former installers for SolarZero were Master Electricians have come forward. The amount owed to the industry group’s members was at least $118,000. Electricians outside the group had also approached it.
NZ Green Investment Finance - a “green investment bank” created by the previous Government to fund environmentally-friendly businesses - made a $145m debt facility available to SolarZero, as well as facilitating $220m in credit lines from international private lenders First Sentier Investors, Natixis Investment Managers and Societe Generale.
“At the time of SolarZero’s liquidation, approximately $115m of NZGIF’s commitment was drawn down against installations,” NZGIF said on Friday.
Finance Minister Nicola Willis, who is due to meet with NZGIF executives later this week, said she was urgently seeking more information.
BlackRock said in a statement to the Herald last week: “BlackRock’s Climate Infrastructure business, on behalf of the fund, held extensive discussions with various stakeholders over a period of time to explore and work through several options to reach an outcome that would meet the needs of various parties, which regrettably could not be brought to fruition.
“The team is deeply disappointed with this outcome and has worked with the SolarZero board to appoint a liquidator to ensure an orderly transition of the business in the interests of stakeholders, including SolarZero’s customers, employees, creditors, and others.”
SolarZero offered no-money-up-front solar panel installations, instead charging a monthly subscription over a 25-year contract.
Cameron Smith is an Auckland-based journalist with the Herald business team. He joined the Herald in 2015 and has covered business and sports. He reports on topics including retail, small business, the workplace and macroeconomics.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
