AES to Acquire CILCORP -- Establishes Midwest Base in Competitive Electricity Market.

ARLINGTON, Va.--(BUSINESS WIRE)--Nov. 23, 1998--The AES Corporation (NYSE: AES) and CILCORP Inc., (NYSE: CER) announced today that they have agreed to terms on a definitive agreement under which AES will acquire all of CILCORP's 13,610,680 common shares at a price of $65 per share, or approximately $885 million.

CILCORP, formed in 1985 and headquartered in Peoria, IL, is an energy services company whose largest subsidiary, CILCO, is an 85 year-old gas and electric utility serving approximately a quarter of a million retail customers in Central Illinois. In 1997, CILCORP had consolidated revenues of $976 million and net assets of $1.3 billion. CILCORP and its subsidiaries employ approximately 1,800 people.

The transaction, under which CILCORP will become a wholly-owned subsidiary of AES, requires the approval of CILCORP shareholders and is subject to regulatory approvals by the Federal Energy Regulatory Commission (FERC), the Illinois Commerce Commission (ICC) and the Securities and Exchange Commission (SEC). The United States Department of Justice and the Federal Trade Commission will also review the merger.

The parties expect the transaction to be completed by mid 1999, subject to the previously mentioned approvals.

Mr. Tom Tribone, Executive Vice President, said, "This combination brings together CILCORP, the most competitive electric and gas supplier in Illinois, and AES, the largest global power company. It is important to note that Illinois has enacted a far-sighted restructuring plan that embodies a vision for the industry that is shared by both companies. We believe that the combined company, operating under this first-of-a-kind structure, will be a model of how the electric and gas business will be conducted in the United States in the 21st century."

Mr. Dennis Bakke, President and CEO of AES, stated, "AES is very pleased to become involved in the Illinois market. We look forward to working with the people of CILCORP, the local communities, the ICC and CILCO's customers. This transaction gives us a strong base of operations in the midwestern United States."

CILCORP President and CEO Robert O. Viets said, "The people of AES are committed to grow; they have a business philosophy and ethics that are totally consistent with ours. This transaction brings our company the opportunities of growth far more quickly than it could do on its own. From an investor perspective, the price offered represents a significant premium to shareholders based upon recent market trading and comparable utility acquisition transactions."

AES' business development successes in 1998 include the following:

-- In January, AES acquired the CLESA distribution company in El Salvador for $96.5 million.

-- In January, AES won a bid to sell electricity from a 360 MW gas-fired plant in Haripur, Bangladesh.

-- In April, AES Caracoles signed a 40 year concession agreement for its 230 MW Caracoles project and has taken over the operation of Quebrada de Ullum, an existing 45 MW hydroelectric plant in Argentina.

-- In April, AES' affiliate, Light-Servios de Electricidade, acquired Eletropaulo Metropolitana, the distribution company serving the city of Sao Paulo, Brazil.

-- In May, AES completed its purchase of three electric generating stations from Southern California Edison.

-- In June, AES raised $173 million of non-recourse project financing for the AES Merida III 484 MW gas-fired combined cycle power plant in the City of Merida, Yucatan, Mexico.

-- In June, AES won a bid to sell electricity from a 450 MW gas-fired plant, Meghnaghat, in Bangladesh.

-- In June, AES completed the $350 million acquisition of Edelap, an electric distribution company in the province of Buenos Aires, Argentina.

-- In August, AES won a bid to acquire six coal-fired, electric generating plants from NGE Generation, Inc., an affiliate of New York State Electric & Gas Corporation (RNYSEGS) for approximately $950 million.

-- In October, AES signed a Shareholders Agreement with the Government of Orissa as part of the process to acquire a 49% share in the Orissa Power Generation Corporation ("OPGC") for approximately $144 million.

-- In October, AES won a bid to acquire a 75 percent interest in Telasi, the electricity distribution company of Tbilisi, Georgia, for approximately $25.5 million.

-- In November, AES won a bid to acquire 49% of Empresa de Generaci n Chiriqui S.A. (EGE Chiriqui) and 49% of Empresa de Generacion Bayano (EGE Bayano), two hydroelectric generation companies in Panama, for $91 million.

-- In November, AES was selected by the Government of Sri Lanka as the preferred bidder to develop a 160MW combined-cycle power plant at Kelanitissa.

AES is a leading global power company that currently owns or has an interest in ninety power facilities totaling over 27,000 megawatts in the United States, Canada, Australia, Argentina, Brazil, Dominican Republic, Pakistan, the Netherlands, Hungary, Kazakhstan, Mexico, China and the United Kingdom. AES also distributes electricity to nearly 13 million customers. In addition to having assets in excess of $10 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.

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.

For Additional Information Contact: Ms. Sandra Ross, AES Corporation, [phone] Mr. Gary A. Ebeling, CILCORP Inc., [phone]