The move has no impact in terms of customer electric rates or Dayton-area (or service-area) employment, AES Ohio spokeswoman Mary Ann Kabel told the Dayton Daily News.
“This is a plus for our company in terms of growth plans, and that benefits customers,” Kabel said Tuesday.
Virginia’s AES Corp. acquired DPL Inc. for $4.7 billion in 2011.
This agreement expands on AES’ existing partnership with CDPQ at AES Indiana and creates a similar ownership structure for the two utilities, with no change in management of AES Ohio, the company’s release said.
Kabel said the company is not struggling financially.
“It’s a partnership with a longtime partner that we’ve had with AES,” she said.
Andrew Bischof, a utilities strategist with Morningstar, said the move is not a signal that AES Ohio is in trouble. He sees the investment as part of AES’ broader plans to invest in infrastructure and reliability.
“There has been a trend in the past couple of years of utilities selling minority interests to ... firms as an attractive valuation to support utilities’ broader investment plans,” Bischof said.
“We have a successful track record of incorporating strategic partners into our businesses in support of our growth initiatives. CDPQ has been a long-term partner to AES and this transaction marks another strong step forward for AES Ohio, enabling the increased capital investments needed to support our customers’ growing needs,” Andrés Gluski, AES president and chief executive, said in a statement.
AES Ohio plans to invest more than $1.5 billion through 2027 to improve system reliability, through investment in transmission infrastructure and grid modernization, the utility said.
This agreement is subject to regulatory approvals, including from the Public Utilities Commission of Ohio, the Federal Energy Regulatory Commission and the Committee on Foreign Investments in the United States.
CDPQ manages funds for public pension and insurance plans. It reported a 4.2% return on depositors’ funds, slightly below the benchmark portfolio’s 4.6%, for the first half of the year, an insurance news web site, insurancebusinessmag.com, reported last month.
In July, CDPQ said it had $197 billion invested in U.S. interests or companies, or 38% of its global portfolio, a share that has almost doubled in the last decade.
A spokesman for the Office of the Ohio Consumers Counsel declined comment.
AES Ohio serves more than 20 counties in Western Ohio.
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