Global power company AES will acquire DPL for $3.5bn in cash, following a definitive merger agreement between the two companies.

Under the terms of the agreement, AES will acquire all of the outstanding shares of DP.

The transaction, with an enterprise value of $4.7bn, has been approved by the board of directors of DPL and AES.

The transaction is expected to close in the next six to nine months and is subject to approval by DPL’s shareholders and from the Federal Energy Regulatory Commission, the Public Utilities Commission of Ohio and the antitrust review under the Hart-Scott-Rodino Act.

AES president and chief executive officer Paul Hanrahan said the acquisition is expected to be value and earnings accretive to build its nearby utility business at Indianapolis Power & Light Company.

DP&L will remain headquartered in Ohio, US, for at least two years after the merger.