Hump Day didn't present much of an obstacle for SunPower (NASDAQ: SPWR) stock to advance. The solar company's shares gained more than 6% in price that day, comparing quite favorably to the 0.2% rise of the S&P 500 index. The main reason why was the settlement the company reached with one of its business partners.
A dispute resolved, plus...
Both SunPower and said partner, fellow solar company Maxeon Solar Technologies (NASDAQ: MAXN) announced in a joint press release that they have resolved a dispute between them. The pair had fallen out over "alleged breaches of master supply agreements," as SunPower put it without elaboration in an August press release.
In addition to putting this dispute to rest, the two companies agreed that Maxeon will supply solar modules to SunPower through February next year, with the latter retaining its exclusive right to sell the former's M-Series solar panels in this country until the end of the following month.
After that, as the two companies detailed, "Maxeon will be released from non-circumvention obligations with respect to SunPower dealers and will receive warrants to purchase SunPower common stock in a private placement."
It was not specified how many warrants Maxeon would be eligible to buy, nor at what price.
No material effect, SunPower said
While the spat apparently didn't have a material effect on SunPower -- it concluded that August presser by stating that it was reaffirming its guidance for the entirety of 2023 -- no investor likes it when their company fights with a supplier.
So it's unambiguously good news that SunPower and Maxeon have shaken hands and are getting on with their lives. The only question mark is that warrants issue; it remains to be seen how large, extensive, and potentially impactful it'll be to SunPower's ownership structure.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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