AEP to Sell Four Ohio Power Plants for $2.17 Billion


American Electric Power (AEP) today announced it has signed an agreement to sell four competitive power plants totaling approximately 5,200 MW. The plants will be acquired by a newly formed joint venture of Blackstone and ArcLight Capital Partners for about $2.17 billion.

AEP announced in January 2015 that it was considering strategic alternatives for the plants, including a possible sale. The company has lately moved away from wholesale electricity markets toward its regulated business.

The generating capacity of the facilities lies wholly in the PJM Interconnection region and includes:

  • Lawrenceburg Generating Station, 1,186 MW natural gas, Lawrenceburg, Indiana
  • Waterford Energy Center, 840 MW natural gas, Waterford, Ohio
  • Darby Generating Station, 507 MW natural gas, Mount Sterling, Ohio
  • Gen. James M. Gavin Plant, 2,665 MW coal, Cheshire, Ohio

The sale is expected to close in the first quarter of 2017, netting AEP about $1.2 billion in cash after taxes, repayment of debt associated with these assets, and transaction fees. This will amount to an after-tax capital gain of approximately $140 million.  AEP says it may reinvest these funds in its regulated businesses, including transmission, renewable projects, additional debt retirement, and share buybacks.

The sale will be subject to inventory true-ups, income tax, and other adjustments. It will also be subject to regulatory approvals from the Federal Energy Regulatory Commission, the Indiana Utility Regulatory Commission, and federal clearance pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Goldman Sachs and Citigroup Global Markets served as AEP’s financial advisor for the strategic evaluation of these assets during the process. 

Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now


Making DDoS Mitigation Part of Your Incident Response Plan: Critical Steps and Best Practices

Like a new virulent strain of flu, the impact of a distributed denial of service (DDoS) attack is...

The Multi-Tax Challenge of Managing Excise Tax and Sales Tax

To be able to accurately calculate multiple tax types, companies must be prepared to continually ...

Operational Analytics in the Power Industry

Cloud computing, smart grids, and other technologies are changing transmission and distribution. ...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...