AEP To Terminate Deal To Sell Kentucky Operations To Algonquin Power Unit; Backs FY23 View

(RTTNews) - American Electric Power (AEP) announced Monday that it has mutually agreed to terminate its previously announced deal to sell Kentucky operations, i.e., Kentucky Power Co. and AEP Kentucky Transmission Co., Inc., to Liberty Utilities Co., a subsidiary of Algonquin Power & Utilities Corp. (AQN, AQN.TO).

Further, the company reaffirmed its fiscal 2023 operating earnings guidance range at $5.19 to $5.39 per share with long-term growth rate of 6% to 7%. Equity financing forecast remains unchanged, it said.

In a statement, AEP outlined its strategic plans for Kentucky Power and AEP Kentucky Transco.

The company said it is taking swift and decisive action to be best positioned in the near-term, while continuing to develop a long-term strategy for Kentucky that is consistent with the goals of the Kentucky commission.

Julie Sloat, AEP president and chief executive officer, said, "We are working diligently to reimagine our strategy with the goal of not just supporting Kentucky but being an essential part of its economic and energy future. We believe there are opportunities ahead for our Kentucky operations, and we will focus our efforts on economic development, reliability and controlling cost impacts to customers."

The compony noted that proceeds from AEP's contracted renewables sale, which is expected to generate $1.2 billion, will replace previously forecasted proceeds from the Kentucky sale process.

Separately, Algonquin Power stated that after careful consideration, and in light of the evolving macro environment, its Board of Directors have determined that continuing with the deal is not in the best interest of the company.

Algonquin Power also reaffirded its previously-disclosed fiscal 2023 estimate of adjusted net earnings per share for the 2023 fiscal year within a range of $0.55 to $0.61.

In pre-market activity on the NYSE, Algonquin Power shares were trading at $9.25, up 7.18 percent.