April 23 (Renewables Now) - US utility American Electric Power Company Inc (NYSE:AEP) has closed the acquisition of Sempra Energy’s (NYSE:SRE) renewables business and its 724-MW portfolio of wind and battery storage capacity.
Under the USD-1.05-billion (EUR 933.6m) deal, AEP Clean Energy Resources has purchased Sempra Renewables LLC for USD 584 million in cash, including USD 33 million in working capital. The buyer will also assume USD 470 million in existing project debt and tax equity obligations, subject to adjustments, it said on Monday.
The acquisition covers seven wind parks and one battery storage facility located in Colorado, Hawaii, Indiana, Kansas, Michigan, Minnesota and Pennsylvania. BP Wind Energy is a co-owner in five of the wind assets, all of which operate under long-term contracts, and will keep its ownership.
"The addition of these high-quality renewable assets and the experience of our new employees will support our long-term strategy to diversify our generation fleet,” said Nicholas K Akins, AEP’s chairman, president and CEO. As previously announced, the power purchase agreements (PPAs) of the targeted assets, two of which with AEP units, are seen to immediately add to AEP’s earnings and support its outlook for a 5%-7% earnings growth rate this year.
The transaction will see AEP grow its renewable generation portfolio to 1,075 MW. The utility reiterated its guidance for 2019 earnings per share of between USD 4 and USD 4.20.
(USD 1.0 = EUR 0.889)