American Electric Power announces $2 billion common stock offering

Investing.com -- American Electric Power Co. (NASDAQ:AEP) is offering $2 billion in shares of its common stock, as per a statement released on Monday. Citigroup (NYSE:C) and Barclays are acting as joint book-running managers for the offering from the US utility company.

In connection with these forward sale agreements, the forward purchasers (Citigroup and Barclays) or their affiliates and/or agents, known as the "forward sellers," are borrowing from third parties and selling to the underwriters an aggregate of $2 billion of shares of AEP’s common stock.

If a forward purchaser, in its good faith and commercially reasonable judgment, is unable to borrow and deliver for sale on the anticipated closing date the number of shares of AEP’s common stock underlying the applicable forward sale agreement, AEP will issue and sell directly to the underwriters the number of shares that such forward seller does not borrow and deliver.

AEP will not initially receive any proceeds from the sale of shares in this offering by the forward sellers to the underwriters. The forward sale agreements provide for settlement on a settlement date or dates on or prior to December 31, 2026.

If AEP chooses to cash settle all or a portion of a forward sale agreement, it may not receive any proceeds from such decision, and it may owe cash to the relevant forward purchaser. If AEP opts to net share settle all or a portion of a forward sale agreement, it will not receive any cash proceeds from such decision, and it may owe shares of its common stock to the relevant forward purchaser.

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