AES has agreed to divest 10% of its LNG business in the Dominican Republic to Grupo Linda and AFI Popular, and 20% of its AES Colón business in Panama to Grupo Linda, in exchange for collective proceeds totalling $190m
AES to sell stake in its LNG Businesses. (Credit: Tasos Mansour on Unsplash)
US-based energy company AES has signed agreements to divest minority stakes in its liquified natural gas (LNG) businesses in the Dominican Republic and Panama.
Through the transaction, AES aims to expand its existing partnership with Grupo Linda and form a new partnership with AFI Popular, a subsidiary of Grupo Popular.
Under the terms of the agreements, AES will divest a 10% stake in its LNG business in the Dominican Republic to Grupo Linda and AFI Popular.
In addition, the company will sell 20% of its AES Colón business in Panama to Grupo Linda.
In exchange, AES will receive a total of $190m in proceeds from the sale, which will help the company achieve its asset sale proceeds target for this year.
AES executive vice president and energy infrastructure strategic business unit president Juan Ignacio Rubiolo said: “We gain tremendous value from partnering with strong local players who provide valuable support as we transition our businesses in both markets.
“We have enjoyed a productive partnership with Grupo Linda since 2014, and we look forward to close collaboration with AFI Popular as we continue to unlock new sources of value.”
AES has secured all external funding included in its 2023 capital plan, which includes the proceeds from these sell-down agreements, plus those from other transactions announced earlier this year, such as the Warrior Run Power Purchase Agreement termination, and the issuance of $900m of senior notes in May, priced at 5.450%.
In the Dominican Republic, AES operates an LNG regasification terminal with a 160,000m3 LNG capacity storage tank, the 319MW AES Andres combined cycle gas turbine plant.
The US energy company also operates a 328MW DPP combined cycle gas turbine, along with an additional 150MW of solar and wind power plants.
The AES Colón business includes a 381MW combined cycle gas turbine, and an adjacent regasification facility with a 180,000 m3 LNG capacity storage tank.
AES mergers and acquisitions and strategy senior vice president Joel Abramson said: “We take a strategic and systematic approach to asset sales.
“With these transactions, we are not only executing on our asset sales program, but also expanding local partnerships that support the strategic objectives of our businesses to maximize value.”