AES and partner to acquire major stake in Brazilian electric utility for $1 billion.

ARLINGTON, Va.--(BUSINESS WIRE)--May 28, 1997--The AES Corporation (NYSE:AES) announced Wednesday that, together with The Southern Company and The Opportunity Fund, a Brazilian investment fund, it will acquire 14.41% of Cemig (Companhia Energetica de Minas Gerais), an integrated electric utility serving the State of Minas Gerais in Brazil.

These shares, which also represent approximately 33% of the voting interest of Cemig, will be purchased from the State of Minas Gerais in a partial privatization of the company.

Under a shareholder's agreement between the AES consortium and the State, AES will have significant operating influence, including the right to appoint the chief operating officer of Cemig, and will otherwise share control of Cemig with the State of Minas Gerais.

The purchase price is $1.056 billion of which a portion will be financed on a non-recourse basis to AES. The purchase price will be paid in two installments in early June 1997 and in 1998.

Cemig owns 5,000 megawatts of generating plants and serves approximately 4 million customers. In addition, Cemig's service territory is physically contiguous to Light, the utility serving Rio de Janeiro in which AES owns 13.75%.

Thomas A. Tribone, president of AES Americas, stated, "Cemig is one of the premier energy companies in Latin America. This business combined with our other businesses in Brazil and the Southern Cone gives AES a strong and strategic position in the region. With our position in Light, our Uruguaiana Project and now Cemig we hope to be a major contributor to the economic growth now taking place in Brazil."

Dennis W. Bakke, president and CEO of AES, stated, "We are very impressed both by Brazil's commitment to free markets under President Cardoso and the State of Minas Gerais's desire to form a partnership with an experienced international company like AES. We look forward to working with Southern and The Opportunity Fund on this exciting project."

Highlights of AES's business development successes in 1997 include the following:

-- In May, AES announced the completion of the amalgamation with AES China Generating Co. with AES.

-- In April, AES, along with its partner CEA, won a bid to acquire two electricity distribution companies, Eden and Edes, serving the Province of Buenos Aires, Argentina.

-- In April, AES won the right to build, own and operate a 600 MW gas-fired, combined cycle plant in Uruguaiana, Brazil.

-- In March, AES completed a combined public offering of common stock and term convertible securities ("TECONS"), yielding net proceeds to the company of approximately $390 million.

-- In February, AES entered into an agreement to acquire all of the international businesses of Destec Energy Inc., consisting of five plants in operation and construction representing approximately 950 MW (based on AES's net equity ownership to be acquired), and numerous projects in various stages of development.

-- In February, a subsidiary of AES raised 112.5 million pounds of non-recourse project financing for its 230 MW (net) gas-fired combined cycle plant in Barry, South Wales, United Kingdom.

-- In February, AES announced plans to build a 720 MW (net) gas-fired combined cycle plant in Pennsylvania to supply electricity to a subsidiary of GPU Inc., pursuant to three restructured power purchase agreements.

-- In January, AES acquired an additional 2.4% interest in Light Servicos de Eletricidade S.A., a 3,800 MW integrated Brazilian utility, bringing AES's total interest to 13.75%.

-- In January, AES won a bid to build, own and operate a 484 MW (net) gas-fired combined cycle power plant in Merida, Mexico.

AES is a leading global power company that currently owns or has an interest in 34 power facilities totaling over 11,000 megawatts in the United States, Argentina, Brazil, Pakistan, Hungary, Kazakstan, China and the United Kingdom.

In addition to having assets of $3.8 billion, the company has more than $5 billion of projects in construction or late stages of development. AES is dedicated to providing electricity worldwide in a socially responsible way. -0-

For more general information visit our web site at www.aesc.com or contact investor relations at [e-mail] . The list aes-pr-announce is an automated mailing list and can be found on the investing page of our web site. Those who subscribe to this list will receive updates when AES issues a press release.

CONTACT: The AES Corporation

Kenneth R. Woodcock, 703/522-1315