American Electric Power intends to sell AEP OnSite Partners, a distributed resources business, to funds advised by London-based private equity firm Basalt Infrastructure Partners, the utility company said Monday.
AEP said it expects to net about $315 million after taxes and transaction fees from the sale. The company expects the sale to close in the third quarter after regulatory approvals from the Federal Energy Regulatory Commission and others are in hand.
“OnSite is a leading provider of distributed energy solutions and benefits from a large addressable market supported by attractive macro fundamentals” David Greenblatt, partner and head of North America at Basalt, said in a release.
AEP OnSite Partners owns more than 300 MW of solar, battery, fuel cell, peaking generation, and substation projects at almost 100 sites across the country, Basalt said. AEP OnSite Partners sells the output to schools, municipalities, hospitals and other commercial and industrial customers in 21 states.
The net book value of the company’s assets was $349 million as of March 31, Columbus, Ohio-based AEP said in an April 30 filing with the U.S. Securities and Exchange Commission.
The sale is part of AEP’s recent move to sell unregulated assets to concentrate on its regulated utilities.
“AEP is focused on a strong balance sheet as we direct capital to our regulated operations to provide reliable, affordable energy to our customers,” Ben Fowke, AEP interim CEO and president, said.
However, after conducting a sale process, AEP has decided to keep its retail energy business, AEP Energy.
“As load continues to grow in our deregulated states, AEP Energy keeps us closely connected to opportunities to support this demand and provide tailored energy solutions to customers,” Fowke said in a press release.
AEP Energy, a competitive electric and gas supplier in six states and Washington, D.C., had about 954,000 customer accounts as of March 31, according to the SEC filing.
