American Electric Power To Sell Its Kentucky Operations To Algonquin Power & Utilities

(RTTNews) - American Electric Power (AEP) Tuesday said it agreed to sell its Kentucky operations, which include Kentucky Power and AEP Kentucky Transco, to Liberty, the regulated utility business of parent company Algonquin Power & Utilities Corp. (AQN), for $2.846 billion enterprise value.

The sale is expected to close in the second quarter of 2022, pending regulatory approvals.

AEP expects the sale to have an immaterial, one-time impact to after-tax book earnings. The transaction will be $0.01-$0.02 accretive to 2022 ongoing earnings.

AEP announced in April 2021 that the company was conducting a strategic review of its Kentucky operations, including a potential sale, and held a competitive process as part of the review.

Founded in 1919 and headquartered in Ashland, Kentucky Power serves approximately 165,000 electricity customers in 20 eastern Kentucky counties. AEP Kentucky Transco is a regulated transmission business with assets exclusively in Kentucky.

AEP expects to net approximately $1.45 billion in cash after taxes and transaction fees. The proceeds from the sale will be used to eliminate AEP's forecasted equity needs in 2022 as the company invests in regulated renewables, transmission and other projects.