BlackRock's GIP nears $38 billion takeover of utility group AES, FT reports

(Reuters) -BlackRock-owned Global Infrastructure Partners (GIP) is nearing a $38 billion deal, inclusive of debt, to acquire utility group AES, the Financial Times reported on Tuesday, citing people briefed on the matter. Utilities benefit from a surge in power demand driven by artificial intelligence and data centres, prompting companies and investors across the board to strike deals with them. Talks between GIP and Virginia-based AES were at an advanced stage, although they could still fall through, according to the FT report. Reuters could not immediately confirm the report. GIP, an infrastructure investment fund, declined to comment to the Financial Times. AES declined to comment, while GIP did not respond to a Reuters' request for comment outside regular business hours. AES, which surpassed Wall Street estimates for its second-quarter profit in July, has experienced significant growth in its renewables unit over the past year. This expansion has been fueled by a global push for cleaner sources of power generation, coinciding with projections that U.S. power consumption will reach record levels. Shares of AES surged nearly 13% on July 8 after Bloomberg News reported that the power provider was weighing strategic options, including a potential sale, following takeover interest from several major investment firms. GIP has a track record in the utility space. In 2024, GIP and CPP Investments acquired U.S. utility Allete in a $6.2 billion take-private deal, including debt. (Reporting by Gnaneshwar Rajan and Mrinmay Dey in Bengaluru; Editing by Alan Barona, Sherry Jacob-Phillips and Harikrishnan Nair)

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