AEP Secures Minority Equity Interest Investment in Ohio and Indiana & Michigan Transmission Companies | PR Newswire [Video]

• A 50/50 strategic partnership between KKR and PSP Investments agrees to acquire 19.9% non-controlling equity interest in two AEP Transcos for $2.82 billion
• Transaction provides highly efficient financing to support AEP’s five-year, $54 billion capital investment plan, enhance reliability for customers and strengthen balance sheet

, /PRNewswire/ — American Electric Power (Nasdaq: AEP) today announced a definitive agreement for a strategic partnership between KKR and PSP Investments to acquire a 19.9% equity interest in the company’s Ohio and Indiana & Michigan Transmission Companies (Transcos) for $2.82 billion. The Transcos are transmission-only, Federal Energy Regulatory Commission (FERC) regulated utilities that build, own and operate transmission infrastructure.

The transaction multiple of 30.3 times LTM P/E is highly attractive and is a significant premium to AEP’s current stock price. The 19.9% minority equity interest represents approximately 5% of AEP’s total transmission rate base.

This transaction allows AEP to efficiently finance a growing segment of its business in the Midwest and enhance its ability to serve …