Behind BlackRock & EQT's deal to buy Clean Energy Firm AES

Utilities and renewable power company AES is set to be taken private in a US$33bn deal by a consortium led by BlackRock-owned Global Infrastructures and EQT.
Under the agreement, stockholders will receive US$15 in cash per share when the transaction is finalised.

In a statement announcing the deal, Andrés Gluski, President and CEO of AES, says: “Over the course of our 45-year history of powering industries and shaping the future of energy, AES has built a diverse portfolio to meet the evolving power needs of our customers and communities.

“We believe this transaction maximises value for existing stockholders and positions the company for long-term success as we continue delivering on our commitments to customers, communities and people.”

AES says that going private will strengthen its financial position and create greater scope to advance its sustainable energy strategy, supporting both innovation and long-term growth.

“We look forward to partnering with the consortium, which has expressed an appreciation for the value of AES' innovation, global reach and diverse portfolio," Andrés adds.

The acquisition is expected to close by late 2026 or early 2027.

AES's need for capital

Following the announcement, AES shares fell by 17%. BlackRock reportedly began negotiations last October in a deal initially valuing the US utility at US$38bn, according to Reuters – one of the largest proposed acquisitions ever involving a US-listed power company.

Despite that early optimism, the final agreed price came in nearly US$5bn lower. AES Chair Jay Morse notes that the sale addresses the firm’s “significant need for capital”.

“In the absence of a transaction with the consortium, the company would likely require a plan that includes reduction or elimination of the dividend and/or substantial new equity issuances.

“After extensive work and deliberation, we concluded that this transaction is in the best interest of AES stockholders.” he comments.

A clean, green data economy

AES says the deal will allow it to expand its role in meeting the surging electricity demand from data centres through long-term clean energy contracts.

The company has signed 11.8 GW of renewable supply agreements with customers including Microsoft, Alphabet and Amazon, as well as a 20-year contract for Google’s data centre in Wilbarger County, Texas.

Through the partnership with Google, AES is developing, owning and operating co-located renewable generation to directly power the Texas facility.

“Our expanded partnership with Google demonstrates how AES can accelerate data centre development by delivering powered land and energy at scale," says Andrés.

“AES is recognised as a world leader in providing energy solutions to technology companies. To-date, AES has signed agreements for nearly 12 GW of energy with data centre customers, 9 GW of these are PPAs directly with hyperscalers.”

AES plans to fund near-term costs using internal cash flow and proceeds from asset sales. The company expects this strategy to underpin projected annual revenue of US$12bn and earnings of US$1.7bn by 2028.