By Kennedy Maize
Private equity giant BlackRock and Swedish private equity firm EQT have assembled a consortium to buy AES Corp. (NYSE:AES) for $33..4 billion — $15/share in cash — taking the Arlington, Va., energy firm private. The price represents a 40% premium over the AES share price as of July 2025, when rumors of a takeover first surfaced. The complex deal is expected to close late this year or in 2027.
The consortium also includes the California Public Employees’ Retirement System (“CalPERS”) and Qatar Investment Authority (“QIA”).
AES is one of the world’s leading power companies, generating and distributing electric power in 15 countries. AES is a global Fortune 500 power company and major global player. It has a generating portfolio that is heavy in wind and solar along with gas and coal.
AES also owns conventional, regulated electric utilities in Indiana and Ohio. AES acquired Indianapolis Power & Light (Ipalco) in 2000 and Dayton Power & Light in 2011. AES said “Indiana and AES Ohio will continue as locally operated and managed regulated utilities.”
In a news release, AES said the BlackRock deal will give the company “increased financial flexibility as a private company to advance its strategy and meet the needs of its customers and communities with reliable, affordable and sustainable energy solutions,” adding that it will address the company’s “significant need for capital to support its growth beyond 2027; absent this transaction, funding for future growth investments would likely require a reduction or elimination of the dividend and/or significant new equity issuances.”
AES CEO Andrés Gluski said, “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 maximizes value for existing stockholders and positions the Company for long-term success as we continue delivering on our commitments to customers, communities and people.”
Formed in 1981, AES became a seminal company that in the 1990s shaped what has become the modern U.S. electric industry. It was the first independent power producer, a company generating electricity that was not part of the conventional vertically integrated electric company featuring generating power, moving it over long distances, and delivering it to captive customers.
AES was the product of two young Nixon administration appointees to the former Federal Energy Administration, one of the predecessors to the U.S. Department of Energy, Roger Sant (d.o.b. 5/24/1931) and Dennis Bakke (d.o.b. 11/6/45). They stayed with the government through the Carter administration.
When Sant and Bakke were involved in federal policymaking the embedded conventional wisdom was that electricity was a “natural monopoly.” Investopedia defines this as “when one company can efficiently serve the market at a lower cost compared to its competitors. As such, the industry or sector comes with high barriers to entry and startup costs for new players.”
Sant and Bakke in 1981 formed an energy consulting company, Applied Energy Services. They soon began doubting the natural monopoly model, considering that it was possible to raise the money necessary to build generating plants that were not linked to transmission and distribution.
That idea was largely built on the 1978 passage of the Public Utility Regulatory Policies Act of 1978, which created a class of electric generators — called “Qualifying Facilities (QFs)” — non-utility generators that could produce power for sale to established utilities.
In 1988, the company’s official history notes, “AES becomes the first and largest IPP in the US, bringing competitive generation and energy affordability to the market.” In 1991, AES went public, listed on the New York Stock Exchange as “AES.”
From that beginning, independent power producers, aka non-utility generators, became a major feature of the U.S. electric system, bringing market competition to what clearly is not a natural monopoly.
The independent generators also led the industry in responding to changes in how power is generated in the U.S., including a move from coal to gas and the rise of renewables. The AES history notes that in 1989, “Caring for our carbon before it was common, AES creates the first documented carbon offset program in the US by planting 52 million trees in Guatemala,”
A study this year by the financial services company Pathward, said, “Many IPPs focus on renewable energies – wind, solar, hydro, or stand-alone battery projects – selling power directly into wholesale energy markets. Their independence has made them a key driver in transforming the U.S. energy sector.”
The Pathward paper added, “IPPs emerged as governments sought to expand generation capacity, encourage competition, and diversify energy sources beyond traditional utilities. Today, their role is critical as the nation moves toward independent and renewable sources of energy.”
Over the years, AES emerged as an enormous international company changing the energy landscape wherever it chose to operate. How it evolves next should be well worth following.