Equity

3 Months Ended

Sep. 30, 2011

EQUITY

11. EQUITY

STOCK REPURCHASE PROGRAM

In July 2010, the Company's Board of Directors approved a stock repurchase program (the “Program”) under which the Company can repurchase up to $500 million of AES common stock. The Board authorization permits the Company to repurchase stock through a variety of methods, including open market repurchases and/or privately negotiated transactions. There can be no assurances as to the amount, timing or prices of repurchases, which may vary based on market conditions and other factors. The Program does not have an expiration date and it can be modified or terminated by the Board of Directors at any time.During the nine months ended September 30, 2011, shares of common stock repurchased under this plan totaled 19,987,795 at a total cost of $224 million plus a nominal amount of commissions (average of $11.24 per share including commissions), bringing the cumulative total purchases under the program to 28,370,620 shares at a total cost of $324 million plus a nominal amount of commissions (average of $11.42 per share including commissions).

The shares of stock repurchased have been classified as treasury stock and accounted for using the cost method. A total of 36,832,776 and 17,287,073 shares were held as treasury stock at September 30, 2011 and December 31, 2010, respectively. The Company has not retired any shares held in treasury during the nine months ended September 30, 2011.

COMPREHENSIVE INCOME

The components of comprehensive income (loss) for the three and nine months ended September 30, 2011 and 2010 were as follows:

				Three Months Ended				Nine Months Ended
				September 30,				September 30,
				2011		2010		2011		2010
				(in millions)				(in millions)
Net income				$	175	$	397	$	1,085	$	1,228
	Change in fair value of available-for-sale securities, net of income tax benefit
		of $0, $0, $1 and $4, respectively			(1)		-		(3)		(6)
	Foreign currency translation adjustments, net of income tax (expense)
		of $42, $(15), $28 and $(7), respectively			(589)		285		(327)		519
	Derivative activity:
		Reclassification to earnings, net of income tax (expense)
			of $(13), $(3), $(15) and $(22), respectively		53		13		112		81
		Change in derivative fair value, net of income tax benefit
			of $68, $23, $93 and $82, respectively		(236)		(99)		(305)		(336)
	Total net change in fair value of derivatives				(183)		(86)		(193)		(255)
	Change in unfunded pension obligation, net of income tax (expense)
		of $(2), $(1), $(6) and $(3), respectively			5		1		12		6
Other comprehensive income (loss)					(768)		200		(511)		264
Comprehensive income (loss)					(593)		597		574		1,492
Less: Comprehensive (income) loss attributable to noncontrolling interests(1)					12		(385)		(651)		(789)
Comprehensive income (loss) attributable to The AES Corporation				$	(581)	$	212	$	(77)	$	703

(1)Includes the income attributed to noncontrolling interests in the form of common securities and dividends on preferred stock of subsidiary.

The components of accumulated other comprehensive loss as of September 30, 2011 and December 31, 2010 were as follows:

	September 30,		December 31,
	2011		2010
	(in millions)
Foreign currency translation adjustment	$	2,002	$	1,824
Unrealized derivative losses, net		511		344
Unfunded pension obligation		212		216
Securities available-for-sale		2		(1)
Accumulated other comprehensive loss	$	2,727	$	2,383

EQUITY TRANSACTIONS WITH NONCONTROLLING INTERESTS

On July 7, 2011, a subsidiary of the Company completed the acquisition of an additional 10% equity interest in AES-VCM Mong Duong Power Company Limited (“Mong Duong”), a 1,200 MW coal-fired power plant in development in the Quang Ninh province in Vietnam, from Vietnam National Coal and Mineral Industries Group, its minority shareholder. On July 8, 2011, through a subsidiary, the Company sold 30% and 19% equity interests in Mong Duong to PSC Energy Global Co., Ltd. (a wholly owned subsidiary of POSCO Corporation) and Stable Investment Corporation (a wholly owned subsidiary of China Investment Corporation, a related party) respectively, resulting in the Company retaining a 51% indirect equity interest in Mong Duong.As a result of these transactions, the Company did not lose control of Mong Duong, which continues to be accounted for as a consolidated subsidiary. A net gain of $19 million resulting from these transactions was recorded as an equity transactionin additional paid-in capital.

The following table summarizes the net income attributable to The AES Corporation and transfers (to) from noncontrolling interests for the three and nine months endedSeptember 30, 2011 and 2010:

				Three Months Ended				Nine Months Ended
				September 30,				September 30,
				2011		2010		2011		2010
				(in millions)
Net (loss) income attributable to The AES Corporation				$	(131)	$	114	$	267	$	445
	Transfers (to) from the noncontrolling interests:
		Net increase in The AES Corporation's paid-in capital
			for sale of subsidiary shares		19		-		19		-
	Net transfers (to) from noncontrolling interest				19		-		19		-
Change from net income attributable to The AES Corporation
	and transfers (to) from noncontrolling interests			$	(112)	$	114	$	286	$	445