AEP signs agreement to sell Kentucky operations

American Electric Power signed an amended agreement to sell its Kentucky operations to Liberty.

Liberty will acquire AEP’s Kentucky operations by purchasing all the stock of Kentucky Power and AEP Kentucky Transco for a reduced price of $2.646 billion as part of the amended agreement. AEP expects to get approximately $1.2 billion in cash, net of taxes and fees.

“I want to thank the employees in Kentucky for their continued focus on delivering safe and reliable power to customers. This sale will provide significant benefits to customers in eastern Kentucky to help offset volatile fuel prices and support economic growth. It also will support AEP’s ability to invest in projects throughout our regulated businesses that will enable the move to a clean, more reliable, and resilient energy system,” AEP Chair and CEO Nicholas Akins said.

The sale is expected to close in January of 2023 following approval of the transaction from the Federal Energy Regulatory Commission (FERC).

“The updated timeline for closing the sale will not have an impact on our planned equity needs or the operating earnings guidance we have provided,” AEP President and CEO Julie Sloat said. “We look forward to receiving approval from FERC and completing the transaction to allow the customer benefits to begin flowing.”

Liberty, the regulated utility business of Algonquin Power & Utilities Corp., previously announced David Swain will lead the Kentucky operations when the transaction is finalized.

Also, AEP announced that Brett Mattison, president and chief operating officer (COO) of Kentucky Power, has been named president and COO of Southwestern Electric Power Company, effective Jan. 1. Mattison succeeds Malcolm Smoak, who is retiring.