In April 2020, AES Ohio began exploring the refinancing of maturing tax-exempt first mortgage bonds and diversification of scheduled maturities. Because of the volatility in the capital markets as a result of the COVID-19 pandemic, capital solutions for the refinancing were limited in the tax-exempt market, and the size of the issuance was not index eligible in the public market.
AES Ohio, an indirect and wholly-owned subsidiary of AES Corporation, is a regulated electric transmission and distribution utility that serves customers in West Central Ohio.
While this was the first transaction directly with AES Ohio, we have been working with AES since 2006. Over nearly 15 years, we have executed multiple financings to help grow AES’s renewable energy and power portfolio.
In April 2020, AES Ohio began exploring the refinancing of maturing tax-exempt first mortgage bonds and diversification of scheduled maturities from its 30-year bond issuance in the public market. Because of the volatility in the capital markets as a result of the COVID-19 pandemic, capital solutions for the refinancing were limited in the tax-exempt market, and the size of the issuance was not index eligible in the public market.
AES Ohio chose to work with us because we could provide certainty of execution in a volatile environment, an ability to structure a bilateral transaction with a reputable investor of size, a streamlined process, issuance of conveniently sized notes, and our successful transaction history with AES.
At the end of July 2020, amid the COVID-19 pandemic, we closed on the transaction and provided $140 million 20-year senior secured first mortgage bond financing. AES Ohio described the process and partnership with us as smooth and wished they had considered us for their utility needs earlier.
Our investment with AES Ohio reinforces our commitment to investments in power and project finance.
