AEP Repurchases 12.5 Million Shares of Common Stock in Accelerated Share Repurchase Transaction

March 9, 2005 8:50 AM EST
American Electric Power (NYSE: AEP) has repurchased 12.5 million shares of its common stock in an accelerated share repurchase transaction with Merrill Lynch. The initial price paid per share was $34.63, with the $433 million for the repurchase funded from available cash on hand.

Last week, AEP announced that its board of directors had approved a plan to repurchase up to $500 million in common stock through 2006. The company said that cash available from completed asset sales were to be used to fund the share repurchase. AEP ended 2004 with $420 million in cash and cash equivalents, and in January closed the sale of controlling interest in Houston Pipe Line Co. for a total consideration of approximately $1 billion. Proceeds from asset sales will also be used to reduce $250 million of utility debt and $550 million of debt at the parent company.

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