State treasurer warns AES-BlackRock deal won't prioritize Indiana residents

The Indiana state treasurer is asking federal regulators to scrutinize and make transparent the terms of a $33 billion deal to take the parent company of AES Indiana private, citing concerns over foreign influence and rising utility costs. 

Treasurer Daniel Elliott told WFYI that global investors are targeting Indiana’s “digital crossroads” to help fund the race for artificial intelligence. Big Tech companies Google, Meta and others are racing to build data centers in the state. 

“I think that’s a great opportunity for growth in our state, but it can’t be on the backs of regular Hoosiers and ratepayers,” Elliott said. “It’s been harder and harder for electricity to be affordable for a single mom.”

As the state’s chief investment officer and banker, the treasurer does not have direct authority over utility sales, but Elliott said he is using his position to raise awareness. The treasurer also serves as chair or member of several state boards, among the office’s other responsibilities.

“Unless we are asked, mainly where we might come into play is if we’re asked to help bond or fund a project that might be related to state or local government,” he said.

AES Indiana’s parent company, AES Corporation, struck a deal with a consortium of domestic and international investors to be taken private. The private equity group includes BlackRock subsidiary Global Infrastructure Partners, California state pension fund CalPERS, the Qatar Investment Authority and Swedish EQT’s Infrastructure VI fund.

The group of investors will pay $15 per share in cash, totaling a $33.4 billion that includes the buyout of public stockholders. Once the deal closes, AES will be removed from public trading to operate as a private company.

“All are companies that, individually, there would be some questions and concerns, but when you throw all of them together, you have a lot of companies that, real frankly, aren’t really focused on Hoosiers and Hoosier ratepayers,” said Elliott.

He specifically pointed to past investment decisions by BlackRock and a Congressional investigation into CalPERS.

In a statement, AES defended the deal, asserting it “will deliver compelling near-term value to stockholders,” better position the company for sustained growth and allow it to “deliver reliable energy solutions for customers and create long-term value for other stakeholders, including its workforce and local communities.”

BlackRock and EQT did not respond to WFYI’s request for comment.

The deal is under scrutiny as Indiana’s utility regulator announced it will investigate the state’s five investor-owned utility companies.

Elliott worries the deal will hurt Indiana residents facing cost-of-living strains.

“This isn’t a regular business,” he said of AES Indiana. “This is a regulated monopoly. We need to make sure that the rate payers’ concerns are our top priority.”

Contact WFYI data journalist Zak Cassel at zcassel@wfyi.org.