DEAL: Blackstone and Arclight AEP acquisition

Author: Edward Price | Published: 14 Oct 2016

The Blackstone Group and ArcLight are acquiring four Midwest power plants from subsidiaries of American Electric Power (AEP) for $2.17 billion, a deal the market sees as a symbol of an industry in flux, but one thriving with opportunity too.

The four plants in question, which have a combined 5.2 GW in output, are Lawrenceburg Generating Station, in Indiana, and the Waterford Energy Center, Darby Generating Station, and the James M. Gavin Plant, all in Ohio.

AEP – a public utility holding company – announced back in January 2015 that it was exploring strategic alternatives for the power plants, including a potential sale. The transaction will now be funded by a combination of equity from each sponsor and fully committed debt financing. It is expected to close in the first quarter of 2017.

The deal is noteworthy for both its size and scale.

"It’s a very large deal and from...