Columbus, Ohio — May 15, 2026, 07:00 EDT
American Electric Power’s stock offering has swelled close to $3 billion, with underwriters taking up their entire allotment of extra shares. The Ohio utility now has more flexibility to bankroll a much bigger grid and power project buildout.
The underwriters took up an option for another 3,070,866 shares, according to a May 14 filing, pushing the total number of borrowed shares sold through the forward-sale deal to 23,543,308. AEP had set the initial price for its 20,472,442-share offering at $127 per share.
Timing matters here. Earlier this month, AEP bumped its 2026-2030 capital plan to $78 billion from $72 billion, following deals for 7 gigawatts of new load in the first quarter—mostly in Ohio and Texas. That’s 1,000 megawatts per gigawatt. By 2030, AEP is looking for total incremental load to climb to 63 gigawatts, driven largely by demand from data centers, hyperscalers, and big industrial users—essentially, the cloud giants fueling the AI surge.
Last week, Reuters said AEP is negotiating with Google on a potential multi-billion-dollar data center project in West Virginia, while it’s also lined up to supply transmission for a substantial Japan-funded natural gas data center campus in Piketon, Ohio. That uptick in utility investment has triggered fresh worries about higher power costs for both residential and commercial customers.
Under the deal, banks can borrow and sell AEP shares up front through forward sale agreements, leaving AEP to decide when it will actually issue the shares and collect the proceeds. BofA Securities, Goldman Sachs, and Morgan Stanley are running the books, and the same trio—Bank of America, Goldman Sachs, and Morgan Stanley—are tapped as forward purchasers.
AEP isn’t getting its hands on the proceeds right away. According to the prospectus, the company anticipates roughly $2.56 billion in net proceeds prior to expenses—or about $2.94 billion if the entire option is picked up—once the forward contracts are fully physically settled, which is targeted on or before May 31, 2028.
CEO Bill Fehrman calls the spending plan a direct answer to “substantial demand growth across our footprint,” and says there’s still an “intense focus on affordability.” AEP points out that signed large-load contracts might offset as much as $16 billion in costs for current customers over the full term of those agreements. AEP
Investors took note of the potential dilution, sending AEP shares down 3.02% on Wednesday to $127.95. That move put the stock behind NextEra Energy, Duke Energy, and Southern Co., according to MarketWatch data. Ahead of Friday’s regular U.S. session, AEP changed hands at $128.60, a 0.5% bump from the prior close.
But there’s a hitch in the deal: if AEP chooses cash or net-share settlement on those forward contracts, it could end up with less cash, nothing at all, or even have to pay cash—or hand over shares—to the banks. The company also flagged that either physical settlement or net share settlement would dilute earnings per share.
The bigger balance-sheet issue still looms. AEP stuck to its 2026 operating earnings target—$6.15 to $6.45 per share—and flagged that the scaled-up capital plan may push its projected operating earnings CAGR past 9% through 2030. Operating earnings strips out items management deems outside routine business.
The stock sale hands AEP fresh financial breathing room. Still hanging over the company: timing around data-center demand, regulatory sign-off on cost recovery, and the challenge of building enough transmission and generation without sparking a customer-rate battle during the AI power surge.
