Columbus – October 12, 2026 -- American Electric Power (Nasdaq: AEP) has launched a registered underwritten offering of $2.6 billion of common stock, structured around forward sale agreements with three banks.
BofA, Goldman Sachs and Morgan Stanley lead the underwriting
BofA Securities, Goldman Sachs & Co. LLC and Morgan Stanley are acting as joint book-running managers. Subject to certain conditions, the forward counterparties or their affiliates are expected to borrow all shares from third parties and sell them to the underwriters.
AEP to sign forward agreements with Bank of America, Goldman Sachs and Morgan Stanley
AEP expects to enter into forward sale agreements with Bank of America, N.A., Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC for an aggregate $2.6 billion of shares. The initial forward sale price per share will equal the price at which the underwriters purchase the shares in the offering, subject to certain adjustments, upon physical settlement.
The underwriters are expected to receive a 30-day option to buy up to an additional $390 million of shares on the same terms. If they exercise it, AEP expects to enter into additional forward sale agreements with the counterparties covering those shares. Full exercise would lift the total offering to $2.99 billion.
Settlement due by May 31, 2028, with cash or net share options
The forward sale agreements are expected to settle on or before May 31, 2028. Subject to certain conditions, AEP may elect cash settlement or net share settlement for all or part of its rights or obligations under the agreements.
If AEP elects physical settlement, it expects to use the net proceeds for general corporate purposes. These may include capital contributions to its utility subsidiaries, acquisitions and/or repayment of debt.
Offering proceeds under an effective SEC shelf registration
The offering is being made under an effective shelf registration statement filed with the U.S. Securities and Exchange Commission. It may be made only by means of a prospectus and the related prospectus supplement.
AEP plans to invest $78 billion from 2026 through 2030. Its risk disclosures cite the availability and cost of capital to finance new projects and refinance existing debt, including the risk that expected sources such as tax credit sales and anticipated securitizations fall short.