A Financial Times report this week suggests that General Infrastructure Partners (GIP) is nearing a $38 billion deal to buy AES (AES), a renewable energy grid company. The speculation sent AES stock skyrocketing, with the shares launching outside their upper Bollinger Band on heavy volume during Wednesday’s session.
While the advanced talks could still fall apart, Barchart Senior Market Strategist John Rowland explains that the reported bid from BlackRock’s (BLK) GIP unit is a headline worth tracking for both investors and consumers:
“This is significant news: private equity entering the utility space. It tells me that the artificial intelligence (AI) play that has legs is the power that will be needed to provide to all of these AI data centers. I have an industry insider who told me that the hyperscalers don't care how much it costs; they just want electricity.”
“Behind this story is the fact that the base load price of electricity has skyrocketed over the last two years, and households are starting to feel the pinch. Could there be pushback from the utility regulatory commission, like what is happening with PJM? Or is this the inflation story that finally breaks the back of the U.S. consumer?”
Screen the top Power & Infrastructure Stocks at Barchart, and catch our next Market on Close livestream for more insights & analysis from John Rowland.
