AES » Topics » 17. SUBSIDIARY STOCK

This excerpt taken from the AES 10-K filed Feb 26, 2010.

17. SUBSIDIARY STOCK

The Company held $60 million of cumulative preferred stock of a subsidiary at December 31, 2009 and 2008. This represented five series of preferred stock of IPL, the Company’s integrated utility in Indiana. The total annual dividend requirements were approximately $3 million at December 31, 2009 and 2008. Certain series of the preferred stock were redeemable solely at the option of the issuer at prices between $100 and $118 per share. Holders of the preferred stock are entitled to elect a majority of IPL’s board of directors if IPL has not paid dividends to its preferred stockholders for four full quarters. Based on the preferred stockholders’ ability to elect a majority of IPL’s board of directors in this circumstance, the redemption of the preferred shares is considered to be not solely within the control of the issuer and the preferred stock is considered temporary equity and presented in the mezzanine level of the consolidated balance sheets in accordance with the relevant accounting guidance for non-controlling interests and redeemable securities.

In February 2009, in connection with a preemptive rights period associated with a share issuance (capital increase) at AES Gener, Inversiones Cachagua Limitada (“Cachagua”), a wholly-owned subsidiary of the Company, paid $175 million to AES Gener to maintain its current ownership percentage of approximately 70.6%.

On November 6, 2008, Cachagua sold a 9.6% ownership interest in AES Gener in a private transaction for $174.9 million. The sale reduced the Company’s ownership percentage of AES Gener from 80.2% to 70.6%. The Company recognized a pre-tax loss of $30.8 million, net of $3.6 million of related fees, from this transaction in the fourth quarter of 2008.

In May and October 2007, Cachagua sold a 0.9% and 10.2% ownership interest, respectively, in AES Gener for $330.9 million. The sale reduced the Company’s ownership percentage of AES Gener to 80.2%. The Company recorded a pre-tax gain on the sale of $134.2 million, including $8.3 million of related fees.

This excerpt taken from the AES 8-K filed Sep 15, 2009.

17. SUBSIDIARY STOCK

The Company held $60 million of cumulative preferred stock of a subsidiary at December 31, 2008 and 2007. This represented five series of preferred stock of IPL, the Company’s integrated utility in Indiana. The total annual dividend requirement was approximately $3 million at December 31, 2008 and 2007. Certain series of the preferred stock were redeemable solely at the option of the issuer at prices between $101 and $118 per share. Holders of one series of preferred stock are entitled to elect a majority of IPL’s board of directors if IPL has not paid dividends to its preferred stockholders for four full quarters. Based on the preferred stockholders’ ability to elect a majority of IPL’s board of directors in this circumstance, the redemption of the preferred shares is considered to be not solely within the control of the issuer and the preferred stock was considered temporary equity and presented in the mezzanine level of the consolidated balance sheets as required by SFAS No. 160 and EITF Topic D-98, “Classification and Measurement of Redeemable Securities.”

On November 6, 2008, a wholly-owned subsidiary of the Company, Inversiones Cachagua Limitada (“Cachagua”), sold a 9.6% ownership interest in AES Gener in a private transaction for $174.9 million. The sale reduced the Company’s ownership percentage of AES Gener from 80.2% to 70.6%. The Company recognized a pre-tax loss of $30.8 million, including $3.6 million of related fees, from this transaction in the fourth quarter of 2008. The net proceeds from this transaction was used exclusively for Gener’s capital increase as approved by Gener’s Extraordinary Shareholders Meeting on November 19, 2008. See further discussion of Gener’s 2009 capital increase in Note 27—Subsequent Events.

In May and October 2007, Cachagua sold a 0.9% and 10.2% ownership interest, respectively, in AES Gener for $330.9 million. The sale reduced the Company’s ownership percentage of AES Gener to 80.2%. The Company recorded a pre-tax gain on the sale of $134.2 million, including $8.3 million of related fees.

Sale of Subsidiary Stock and Brasiliana Restructuring—In September 2006, Brasiliana’s wholly owned subsidiary, Transgás, sold a 33% economic ownership in Eletropaulo, a regulated electric utility in Brazil. Despite the reduction in economic ownership, there was no change in Brasiliana’s voting interest in Eletropaulo

 

125


and Brasiliana continues to control Eletropaulo. Transgás received $522 million in net proceeds on the sale. On October 5, 2006 Transgás, sold an additional 5% economic ownership in Eletropaulo for $78 million in net proceeds. For the year ended December 31, 2006, AES recognized a pre-tax loss of $535 million primarily as a result of the recognition of previously deferred currency translation losses.

This excerpt taken from the AES 10-K filed Feb 26, 2009.

17. SUBSIDIARY STOCK

        Minority interest includes $60 million of cumulative preferred stock of subsidiaries at December 31, 2008 and 2007. The total annual dividend requirement was approximately $3 million at December 31, 2008 and 2007. Each series of preferred stock is redeemable solely at the option of the issuer at prices between $101 and $118 per share.

        On November 6, 2008, a wholly-owned subsidiary of the Company, Inversiones Cachagua Limitada ("Cachagua"), sold a 9.6% ownership interest in AES Gener in a private transaction for $174.9 million. The sale reduced the Company's ownership percentage of AES Gener from 80.2% to 70.6%. The Company recognized a pre-tax loss of $30.8 million, including $3.6 million of related fees, from this transaction in the fourth quarter of 2008. The net proceeds from this transaction was used exclusively for Gener's capital increase as approved by Gener's Extraordinary Shareholders Meeting on November 19, 2008. See further discussion of Gener's 2009 capital increase in Note 27—Subsequent Events.

        In May and October 2007, Cachagua sold a 0.9% and 10.2% ownership interest, respectively, in AES Gener for $330.9 million. The sale reduced the Company's ownership percentage of AES Gener to 80.2%. The Company recorded a pre-tax gain on the sale of $134.2 million, including $8.3 million of related fees.

212


Table of Contents


THE AES CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

DECEMBER 31, 2008, 2007, AND 2006

17. SUBSIDIARY STOCK (Continued)

        Sale of Subsidiary Stock and Brasiliana Restructuring—In September 2006, Brasiliana's wholly owned subsidiary, Transgás, sold a 33% economic ownership in Eletropaulo, a regulated electric utility in Brazil. Despite the reduction in economic ownership, there was no change in Brasiliana's voting interest in Eletropaulo and Brasiliana continues to control Eletropaulo. Transgás received $522 million in net proceeds on the sale. On October 5, 2006 Transgás, sold an additional 5% economic ownership in Eletropaulo for $78 million in net proceeds. For the year ended December 31, 2006, AES recognized a pre-tax loss of $535 million primarily as a result of the recognition of previously deferred currency translation losses.

Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki