REDEEMABLE STOCK OF SUBSIDIARIES

The following table is a reconciliation of changes in redeemable stock of subsidiaries (in millions):



December 31,	2016			2015
Balance at the beginning of the period	$	538		$	78
Sale of redeemable stock of subsidiaries	134			460
Contributions from holders of redeemable stock of subsidiaries	130			—
Net loss attributable to redeemable stock of subsidiaries	(11		)	—
Fair value adjustment recorded to retained earnings ⁽¹⁾	4			—
Other comprehensive income attributable to redeemable stock of subsidiaries	6			—
Acquisition and reclassification of stock of subsidiaries	(19		)	—
Balance at the end of the period	$	782		$	538

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⁽¹⁾	$5 million increase in fair value of DP&L preferred shares offset by $1 million decrease in fair value of Colon common stock.

The following table summarizes the Company's redeemable stock of subsidiaries balances as of the periods indicated (in millions):



December 31,	2016		2015
IPALCO common stock	$	618	$	460
Colon quotas⁽¹⁾	100		—
IPL preferred stock	60		60
Other common stock	4		—
DPL preferred stock	—		18
Total redeemable stock of subsidiaries	$	782	$	538

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⁽¹⁾	Characteristics of quotas are similar to common stock.

Colon — During the year ended December 31, 2016, our partner in Colon increased their ownership from 25% to 49.9% and made capital contributions of $106 million. Any subsequent adjustments to allocate earnings and dividends to our partner, or measure the investment at fair value, will be classified as temporary equity each reporting period as it is probable that the shares will become redeemable.

IPL — IPL had $60 million of cumulative preferred stock outstanding at December 31, 2016 and 2015, which represented five series of preferred stock. The total annual dividend requirements were approximately $3 million at December 31, 2016 and 2015. Certain series of the preferred stock were redeemable solely at the option of the issuer at prices between $100 and $118 per share. Holders of the preferred stock are entitled to elect a majority of IPL's board of directors if IPL has not paid dividends to its preferred stockholders for four consecutive quarters. Based on the preferred stockholders' ability to elect a majority of IPL's board of directors in this circumstance, the redemption of the preferred shares is considered to be not solely within the control of the issuer and the preferred stock is considered temporary equity.

DPL — DPL had $18 million of cumulative preferred stock outstanding as of December 31, 2015, which represented three series of preferred stock issued by DP&L, a wholly-owned subsidiary of DPL. The DP&L preferred stock was redeemable at DP&L's option as determined by its board of directors at per-share redemption prices between $101 and $103 per share, plus cumulative preferred dividends. In addition, DP&L's Amended Articles of Incorporation contained provisions that permitted preferred stockholders to elect members of the DP&L Board of Directors in the event that cumulative dividends on the preferred stock are in arrears in an aggregate amount equivalent to at least four full quarterly dividends. Based on the preferred stockholders' ability to elect members of DP&L's board of directors in this circumstance, the redemption of the preferred shares was considered to be not solely within the control of the issuer and the preferred stock was considered temporary equity.

In September 2016, it became probable that the preferred shares would become redeemable. As such, the Company recorded an adjustment of $5 million to retained earnings to adjust the preferred shares to their redemption value of $23 million. In October 2016, DP&L redeemed all of its preferred shares. Upon redemption, the preferred shares were no longer outstanding and all rights of the holders thereof as shareholders of DP&L ceased to exist.

IPALCO — In February 2015, CDPQ purchased 15% of AES US Investment, Inc., a wholly-owned subsidiary that owns 100% of IPALCO, for $247 million, with an option to invest an additional $349 million in IPALCO through 2016 in exchange for a 17.65% equity stake. In April 2015, CDPQ invested an additional $214 million in IPALCO, which resulted in CDPQ's combined direct and indirect interest in IPALCO of 24.90%. As a result of these transactions, $84 million in taxes and transaction costs were recognized as a net decrease to equity. The Company also recognized an increase to additional paid-in capital and a reduction to retained earnings of 377 million for the excess of the fair value of the shares over their book value. No gain or loss was recognized in net income as the transaction was not considered to be a sale of in-substance real estate.

In March 2016, CDPQ exercised its remaining option by investing $134 million in IPALCO, which resulted in CDPQ's combined direct and indirect interest in IPALCO of 30%. The Company also recognized an increase to additional paid-in capital and a reduction to retained earnings of $84 million for the excess of the fair value of the shares over their book value. In June 2016, CDPQ contributed an additional $24 million to IPALCO, with no impact to the ownership structure of the investment. Any subsequent adjustments to allocate earnings and dividends to CDPQ will be classified as NCI within permanent equity as it is not probable that the shares will become redeemable.