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Former AMG executive buys into Calif. solar energy company

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Darrell Crate built his career around wealth management. Now, he's branching out into an entirely new field: solar panels.

Crate on Wednesday unveiled a deal in which one of the investment firms he leads will buy a 40 percent stake in privately held Sungevity, an Oakland, Calif., solar company, for about $200 million.

Easterly Acquisition Corp., his Beverly company, would change its name to Sungevity Holdings and trade on the Nasdaq stock exchange, through a complex transaction known as a reverse merger.

Crate had sought investors last year through an initial public offering for Easterly Acquisition, with the purpose of buying or investing in a single company with those funds — one that could use Easterly's shell to become publicly traded without all the hassles of its own IPO.

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Easterly had said that the eventual acquisition would probably be in the financial industry. But Wednesday's deal shows that Crate and his team were also looking at other potential targets.

"We heard clearly from public shareholders that getting exposure to the solar adoption curve was interesting to them," said Crate, Easterly's chairman.

Easterly's deal for Sungevity values it at about $500 million, excluding the company's $125 million stockpile of cash, which will be on its balance sheet after Sungevity uses the deal's proceeds to pay down its debt.

Crate said he expects Sungevity to report a positive cash flow — essentially, that revenue would outpace operating expenses — by year's end.

Unlike many other solar companies, Sungevity doesn't own installation trucks or employ home installers. Instead, it designs solar panel systems and acts as a middleman between consumers and contractors.

Sungevity employs about 500 people, according to chief executive Andrew Birch, and provides services in 12 states and the District of Columbia. Massachusetts ranks as one of Sungevity's four largest domestic markets for new customers.

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Shareholders in Easterly have yet to approve the transaction, a vote that's expected in September. After the deal closes, Crate and Avi Kalichstein, another top Easterly executive, will join Sunergy's board of directors.

"Sungevity can [soon] claim to be a hometown company in Massachusetts," Crate said.

Crate also oversees two affiliated firms, Easterly Government Properties and Easterly Capital. The former, a publicly traded real estate investment business, focuses on government buildings. Crate launched the latter, an asset management venture, earlier this year after his noncompete agreement expired with Affiliated Managers Group, where he worked as chief financial officer for more than a decade.


Jon Chesto can be reached at jon.chesto@globe.com.
Follow him on Twitter @jonchesto.