The sale is expected to close in the second quarter. At the closing, AEP is expected to net $1.2 billion in cash.
The portfolio includes 14 projects made up of 1,200 MW of wind and 165 MW of solar in 11 states. Renewable power from the projects is contracted under long-term agreements with other utilities, corporations and municipalities.
AEP said it remains committed to “de-risking the company and prioritizing investments” in itscore regulated businesses. Proceeds from the sale will be directed to a pipeline of projects to advance the utility’s clean energy transition, among other purposes.
The utility plans to invest some $40 billion over the next five years in its regulated wires and generation business with a focus on adding 17,000 MW of new generation resources and more resilient, efficient transmission and distribution infrastructure.
J.P. Morgan is serving as lead financial advisor and Citigroup Global Markets is serving as financial advisor to AEP for this transaction. Hunton Andrews Kurth LLP is serving as legal counsel to AEP.
AEP announced its plan to sell the assets in February 2022 and launched a competitive bidding process in August. The sale is subject to satisfaction of customary closing conditions, including regulatory approval by the Federal Energy Regulatory Commission, clearance from the Committee on Foreign Investment in the United States and approval under applicable competition laws.