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4/9/2015 Printer Friendly: Exclusive: American Electric Power taps Goldman for power plant sale - The Deal Pipeline (SAMPLE CONTENT: NEED AN ID?) <br />1 <br />ipehn <br />Exclusive: American Electric Power taps Goldman for power <br />plant sale <br />by r►3nd ,..e,. Published January 6, 2015 at 10:32 AM ET <br />American Electric Power Co. (AEP), the Columbus, <br />Ohio-based electric utility with a $29 billion market <br />capitalization, has retained Goldman, Sachs & Co. to <br />explore options for its 7,923 megawatt merchant <br />generation business <br />The investment bank's hiring had been reported to The <br />Deal by three sources familiar with the matter. <br />When reached on Tuesday, an AEP spokeswoman <br />confirmed that Goldman had been retained. She said <br />that no timeframe has been set and the company has <br />yet to determine whether a sale will occur. Calls to <br />Goldman were not returned. <br />The power plant portfolio likely will fetch $350 to $450 per kilowatt hour, which could result in a sale price ranging <br />from approximately $2.8 billion to $3.6 billion, according to three industry sources. <br />The portfolio is situated in the PJM, or Pennsylvania, New Jersey, Maryland Power Pool and AEP fully owns and <br />operates 69% of the fleet. It has three coal facilities, consisting of Gavin (2,665), Cardinal 1 (595 MW), and <br />Conesville 5, 6 (810 MW), and two gas plants, including Waterford (840 MW) and Darby (507 MW). AEP also <br />operates 4% of Conesville 4, a 339 MW coal plant; it has a 12% non-operating interest in Zimmer and Stuart, two <br />coal-fired facilities with 330 MW and 603 MW of capacity, respectively; and it has a 15% stake in Lawrenceburg, a <br />1,186 MW gas facility. <br />The merchant business does not fit with the company's profile, as AEP is a regulated utility at its core, said one of <br />the industry sources. It has a $12 billion capital expenditure program for 2015 to 2017, with 96% of its capital <br />allocated to its regulated businesses: $2.7 billion for regulated generation, $3.6 billion for regulated distribution, and <br />$4.8 billion for regulated transmission. <br />"The company has a much cleaner story with the merchant business gone," said an industry source. <br />AEP is among a number of electric utilities trying to reduce their exposure to the competitive power markets <br />through merchant power plant divestitures. <br />http://www.thedeal.com/content/2015/01/exclusive americanelectric_power_tapsyoldman for_power_plant_sale/print/ <br />f - [ 3 1/2 <br />