LOS ANGELES – Blackstone Group LP's Vivint Solar Inc said on Thursday it has raised $540 million to finance its fast-growing business of installing solar panels on home rooftops.
The funds were provided by two undisclosed "major financial institutions" and come on top of the $200 million in financing Vivint announced in August.
In a statement, Chief Executive Greg Butterfield said the funds will help support Vivint's growth. The company has pioneered selling rooftop solar systems to homeowners by knocking on doors.
Just two years after entering the market, Vivint has grown to become the nation's second-biggest installer of residential solar panels. SolarCity Corp , the installer backed by Tesla Motors Inc founder Elon Musk, is the largest.
Both SolarCity and Vivint have benefited from a business model that allows homeowners to avoid the hefty upfront cost of buying a solar system outright.
Vivint puts the panels up on a house using funds provided by financial institutions and makes money by selling the power they produce to the homeowner for less than existing retail power rates. As owners of the panel systems, the financiers are able to claim a federal tax credit worth 30 percent of the value of the solar system.
Vivint Solar is a unit of Vivint Inc, the home security provider acquired by Blackstone last year.
(Reporting by Nichola Groom; Editing by Richard Chang)