AEP to sell nearly 1.4 GW of renewable assets to Invenergy, Blackstone platform

Following a competitive bidding process, American Electric Power Co. Inc. reached a deal to sell its 1,365-MW portfolio of unregulated renewable assets to IRG Acquisition Holdings, a partnership owned by Invenergy LLC, Caisse de dépôt et placement du Québec and Blackstone Infrastructure Partners LP-managed funds, at an enterprise value of $1.5 billion including project debt.

The unregulated renewable portfolio includes 14 projects, representing 1,200 MW of wind and 165 MW of solar in 11 states. The portfolio's output is contracted under long-term agreements with other utilities, corporations and municipalities, according to a Feb. 22 news release.

AEP expects to net approximately $1.2 billion in cash from the transaction after taxes, transaction fees and other customary adjustments.

"The proceeds from the sale will be directed to the significant pipeline of opportunities we have to enhance service for customers across our footprint and advance our clean energy transition," AEP President and CEO Julie Sloat said in a statement.

AEP is selling the portfolio as part of efforts to derisk the company and prioritize investments in its core regulated businesses. The company previously outlined plans to invest $40 billion through 2027 in renewables and mostly in its transmission and distribution operations. AEP aims to add 17,000 MW of new generation resources and to improve the resiliency and efficiency of its transmission and distribution infrastructure.

The sale is subject to customary closing conditions, including regulatory approval by the Federal Energy Regulatory Commission, clearance from the Committee on Foreign Investment in the U.S. and approval under applicable competition laws.

J.P. Morgan is lead financial adviser and Citigroup Global Markets is financial adviser to AEP. Hunton Andrews Kurth LLP is legal counsel.

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