American Electric Power Co Inc AEP, along with PNM Resources Inc PNM, inked a deal to divest around 50% stake each in New Mexico Renewable Development, LLC (NMRD) to Exus North America Holdings, LLC for about $230 million.
In particular, AEP and PNM Resources intend to sell the portfolio of 15 solar projects totaling 625 megawatts (MW).
AEP's share of the sale is around $115 million, and it expects to garner about $104 million in cash after tax, transaction fees, and other customary adjustments.
The sale is projected to close in February 2024 and will not have a material impact on financial results.
Julie Sloat, AEP chair, president, and CEO, said, "This sale is another step forward on our path to simplify our business and focus on investing in our core regulated operations, and we continue to execute our strategy to de-risk the company. Earlier this year, we completed the $1.5 billion sale of other parts of our contracted renewables business."
Also Read: Invenergy Buys American Electric Power's Renewables Portfolio For $1.5B
"The proceeds from these sales are strengthening our balance sheet and supporting our continued efforts to create an energy system that benefits customers by providing safe, reliable and affordable electricity."
In June, AEP launched the sale process for NMRD portfolio, which includes nine operating solar developments totaling 185 MW and six projects under development with an estimated output of 440 MW.
The sale is subject to regulatory approval by the Federal Energy Regulatory Commission, New Mexico regulatory approvals and other approvals.
Also Read: American Electric Power Appoints Charles Zebula As Finance Chief; Reaffirms Guidance
Price Action: AEP shares are trading higher by 0.73% at $80.97 premarket on Tuesday.
Photo via Wikimedia Commons
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
