American Electric Power this week announced the commencement of a registered underwritten offering of $2,000,000,000 of shares of its common stock. According to the company, Citigroup and Barclays are acting as joint book-running managers for this offering.
In addition, the underwriters of the offering expect to be granted a 30-day option to purchase up to an additional $300,000,000 of shares of AEP’s common stock.
Settlement of the forward sale agreements is expected to occur on or prior to December 31, 2026.
Based on the outcome of the sale, AEP says it expects to use the net proceeds for general corporate purposes, which may include capital contributions to its utility subsidiaries, acquisitions and/or repayment of debt.
Earlier this year and separate from this week’s announcement, though of a similar financial range, KKR and PSP Investments partnered to purchase a stake in AEP for $2.82 billion. Chief Executive Bill Fehrman was quoted in the Wall Street Journal in relation to the KKR/PSP agreement saying, “This transaction allows AEP to efficiently finance a growing segment of our business and enhances our ability to serve growing customer demand and provide reliable service to our customers.”
