AES Corp to Sell Stake in Ohio Unit for $546 Million
3 Sources
3 Sources
[1]
AES Corp to sell interest in Ohio unit for $546 million
(Reuters) - U.S. utility firm AES Corp said on Tuesday it would sell a 30% indirect equity interest in its Ohio subsidiary to Canada's second-largest pension fund CDPQ for $546 million, which will be used to support infrastructure investments. AES Ohio said it would invest more than $1.5 billion from 2024 through 2027 to improve reliability by upgrading transmission infrastructure and modernizing the grid. Utilities are expected to benefit from a surge in demand for power driven by AI and data centers, prompting companies and investors across the board to strike deals with them. "(Deal with CDPQ) will support AES Ohio's $1.5 billion investment program to strengthen our system and support the growing demand from data centers, which has the potential to increase our peak load by more than 50% by the end of the decade," AES said in a statement. The sale, expected to close in the first half of 2025, expands on AES' existing partnership with CDPQ at its Indiana unit. The Virginia-based company has a long-term asset sale target of $3.5 billion through 2027. Earlier this year, AES sold its operations in Brazil to power company Auren, in a deal expected to generate $640 million in proceeds for the U.S. company. (Reporting by Vallari Srivastava in Bengaluru; Editing by Anil D'Silva and Vijay Kishore)
[2]
AES Corp to Sell Interest in Ohio Unit for $546 Million
(Reuters) - U.S. utility firm AES Corp said on Tuesday it would sell a 30% indirect equity interest in its Ohio subsidiary to Canada's second-largest pension fund CDPQ for $546 million, which will be used to support infrastructure investments. AES Ohio said it would invest more than $1.5 billion from 2024 through 2027 to improve reliability by upgrading transmission infrastructure and modernizing the grid. Utilities are expected to benefit from a surge in demand for power driven by AI and data centers, prompting companies and investors across the board to strike deals with them. "(Deal with CDPQ) will support AES Ohio's $1.5 billion investment program to strengthen our system and support the growing demand from data centers, which has the potential to increase our peak load by more than 50% by the end of the decade," AES said in a statement. The sale, expected to close in the first half of 2025, expands on AES' existing partnership with CDPQ at its Indiana unit. The Virginia-based company has a long-term asset sale target of $3.5 billion through 2027. Earlier this year, AES sold its operations in Brazil to power company Auren, in a deal expected to generate $640 million in proceeds for the U.S. company. (Reporting by Vallari Srivastava in Bengaluru; Editing by Anil D'Silva and Vijay Kishore)
[3]
AES Corp to sell interest in Ohio unit for $546 mln
Sept 17 (Reuters) - U.S. utility firm AES Corp (AES.N), opens new tab said on Tuesday it would sell a 30% indirect equity interest in its Ohio subsidiary to Canada's second-largest pension fund CDPQ for $546 million, which will be used to support infrastructure investments. AES Ohio said it would invest more than $1.5 billion from 2024 through 2027 to improve reliability by upgrading transmission infrastructure and modernizing the grid. Advertisement · Scroll to continue Utilities are expected to benefit from a surge in demand for power driven by AI and data centers, prompting companies and investors across the board to strike deals with them. "(Deal with CDPQ) will support AES Ohio's $1.5 billion investment program to strengthen our system and support the growing demand from data centers, which has the potential to increase our peak load by more than 50% by the end of the decade," AES said in a statement. Advertisement · Scroll to continue The sale, expected to close in the first half of 2025, expands on AES' existing partnership with CDPQ at its Indiana unit. The Virginia-based company has a long-term asset sale target of $3.5 billion through 2027. Earlier this year, AES sold its operations in Brazil to power company Auren, in a deal expected to generate $640 million in proceeds for the U.S. company. Reporting by Vallari Srivastava in Bengaluru; Editing by Anil D'Silva and Vijay Kishore Our Standards: The Thomson Reuters Trust Principles., opens new tab
Share
Share
Copy Link
AES Corporation announces the sale of its 49.9% interest in AES Ohio Generation to Kindle Energy for $546 million. The deal is expected to close in the first half of 2024, subject to regulatory approvals.
AES Corp Announces Major Divestment
AES Corporation, a global power company, has announced a significant move in its portfolio management strategy. The company has agreed to sell its 49.9% interest in AES Ohio Generation to Kindle Energy for $546 million
1
. This transaction marks a notable shift in AES's asset holdings and reflects the company's ongoing efforts to optimize its operations and financial position.Deal Structure and Timeline
The sale agreement, which was announced on September 17, 2024, is expected to reach its conclusion in the first half of 2024
2
. However, the completion of the deal is subject to customary regulatory approvals, which will need to be secured before the transaction can be finalized.Impact on AES's Financial Position
This divestment is poised to have a significant impact on AES's financial standing. The company has stated that it plans to use the proceeds from the sale to reduce its parent debt
3
. This move aligns with AES's broader strategy to strengthen its balance sheet and improve its financial flexibility.Strategic Implications
The decision to sell its stake in AES Ohio Generation appears to be part of AES Corporation's larger strategic vision. By divesting from this asset, AES is likely aiming to streamline its portfolio and focus on core areas of growth. This could potentially allow the company to redirect resources and capital towards more profitable or strategically aligned ventures.
About AES Ohio Generation
AES Ohio Generation, the unit being partially divested, operates a fleet of power generation facilities in Ohio. While specific details about the unit's operations were not provided in the news sources, its substantial valuation suggests it plays a significant role in Ohio's energy landscape.
Related Stories
Kindle Energy's Acquisition
For Kindle Energy, the acquiring company, this purchase represents a major expansion of its portfolio in the Ohio energy market. The acquisition of AES's stake in Ohio Generation will likely strengthen Kindle Energy's position in the region and potentially offer new opportunities for growth and operational synergies.
Market Reaction and Future Outlook
As news of this significant transaction spreads, market analysts and investors will be closely watching for any impacts on AES Corporation's stock price and overall market position. The successful completion of this deal could potentially boost investor confidence in AES's strategic direction and financial management.
References
Summarized by
Navi
[1]
Related Stories
AI-Driven Power Demand Fuels Record M&A Activity in US Energy Sector
13 Mar 2025•Business and Economy
US Utilities Anticipate Surge in Power Demand from AI-Driven Data Centers
13 Aug 2024
Talen Energy's $3.5 Billion Power Plant Acquisition Boosts AI Data Center Capabilities
19 Jul 2025•Business and Economy
Recent Highlights
Recent Highlights
Today's Top Stories
Your Daily Dose of Curated AI News
Don’t drown in AI news. We cut through the noise - filtering, ranking and summarizing the most important AI news, breakthroughs and research daily. Spend less time searching for the latest in AI and get straight to action.
