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Equity | 12 Months Ended
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Dec. 31, 2011
EQUITY | In July 2010, the Company's Board of Directors approved a stock repurchase program (t he “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 can be modified or terminated by the Board of Directors at any time. During the year ended December 31, 2011, shares of common stock repurchased under this plan totaled 25,541,980 at a total cost of $279 million plus a nominal amount of commissions (average of $10.93 per share including commissions), bringing the cumulative total purchases under the program to 33,924,805 shares at a total cost of $378 million plus a nominal amount of commissions (average of $11.16 per share including commissions). 15. EQUITY STOCK PURCHASE AGREEMENT On March 12, 2010, the Company and Terrific Investment Cor poration (“Investor”), a wholly owned subsidiary of China Investment Corporation, entered into a stockholder agreement (the “Stockholder Agreement”) in connection with the agreement discussed in the following paragraph. Under the Stockholder Agreement, as long as Investor holds more than 5% of the outstanding shares of common stock of the Company, Investor has the right to designate one nominee, who must be reasonably acceptable to the Board, for election to the Board of Directors of the Company. Effective December 9, 2011, Investor's des ignated nominee was elected to the Board of Directors of the Company. In addition, until such time as Investor holds 5% or less of the outstanding shares of common stock, Investor has agreed to vote its shares in accordance with the recommendation of the Company on any matters submitted to a vote of the stockholders of the Company relating to the election of directors and compensation matters. Otherwise, Investor may vote its shares at its discretion. Further, under the Stockholder Agreement, Investor will be subject to a standstill restriction which generally prohibits Investor from purchasing additional securities of the Company beyond the level acquired by it under the stock purchase agreement entered into between Investor and the Company on November 6, 2009. The standstill and lock-up restrictions also terminate at such time as Investor holds 5% or less of the outstanding shares of common stock. Investor has certain registration rights and preemptive rights under the Stockholder Agreement with respect to its shares of common stock of the Company. On March 15, 2010, t he Company completed the sale of 125,468,788 shares of common stock to Investor. The shares were sold for $12.60 per share, for an aggregate purchase price of $1.58 billion. Investor's ownership in the Company's common stock is now approximately 15% of the Company's total outstanding shares of common stock on a fully diluted basis. STOCK REPURCHASE PROGRAM The shares of stock repurchased have been classified as treasury stock and accounted for using the cost method. A total of 42,386,961 and 17,287,073 shares were held in treasury stock at December 31, 2011 and 2010, respectively. The Company has not retired any shares held in treasury during the years ended December 31, 2011, 2010 or 2009. COMPREHENSIVE INCOME The components of comprehensive income for the years ended December 31, 2011, 2010 and 2009 were as follows:
|  |  |  |  | December 31,
|  |  |  |  | 2011 |  | 2010 |  | 2009
|  |  |  |  | (in millions)
Net income |  | $ | 1,530 |  | $ | 1,059 |  | $ | 1,755
| Available-for-sale securities activity: |  |  |  |  |  |  |  |  |
|  | Change in fair value of available-for-sale securities, net of income tax |  |  |  |  |  |  |  |  |
|  |  | (expense) benefit of $0, $3 and $(4), respectively |  |  | 1 |  |  | (5) |  |  | 8
|  | Reclassification to earnings, net of income tax (expense) benefit |  |  |  |  |  |  |  |  |
|  |  | of $0, $0 and $0, respectively |  |  | (2) |  |  | - |  |  | (2)
| Total change in fair value of available-for-sale securities |  |  | (1) |  |  | (5) |  |  | 6
| Foreign currency activity: |  |  |  |  |  |  |  |  |
|  | Foreign currency translation adjustments, net of income tax |  |  |  |  |  |  |  |  |
|  |  | (expense) benefit of $18, $(11) and $(78), respectively |  |  | (484) |  |  | 468 |  |  | 746
|  | Reclassification to earnings, net of income tax (expense) benefit |  |  |  |  |  |  |  |  |
|  |  | of $0, $0 and $0, respectively |  |  | 188 |  |  | 142 |  |  | (4)
| Total foreign currency translation adjustments |  |  | (296) |  |  | 610 |  |  | 742
| Derivative activity: |  |  |  |  |  |  |  |  |
|  | Change in derivative fair value, net of income tax (expense) benefit |  |  |  |  |  |  |  |  |
|  |  | of $108, $56 and $34, respectively |  |  | (379) |  |  | (242) |  |  | 214
|  | Reclassification to earnings, net of income tax (expense) benefit |  |  |  |  |  |  |  |  |
|  |  | of $(22), $(41) and $(41), respectively |  |  | 137 |  |  | 162 |  |  | (141)
| Total change in fair value of derivatives |  |  | (242) |  |  | (80) |  |  | 73
| Pension activity: |  |  |  |  |  |  |  |  |
|  | Change in unfunded pension obligation, net of income tax (expense) |  |  |  |  |  |  |  |  |
|  |  | benefit of $117, $57 and $70, respectively |  |  | (223) |  |  | (111) |  |  | (139)
|  | Reclassification to earnings, net of income tax (expense) benefit |  |  |  |  |  |  |  |  |
|  |  | of $(6), $(12) and $(1), respectively |  |  | 13 |  |  | 23 |  |  | -
| Total change in unfunded pensions obligation |  |  | (210) |  |  | (88) |  |  | (139)
Other comprehensive income (loss) |  |  | (749) |  |  | 437 |  |  | 682
Comprehensive income |  |  | 781 |  |  | 1,496 |  |  | 2,437
Less: Comprehensive income attributable to noncontrolling interests(1) |  |  | (1,098) |  |  | (1,108) |  |  | (1,485)
Comprehensive income (loss) attributable to The AES Corporation |  | $ | (317) |  | $ | 388 |  | $ | 952
(1) Reflects the (income) loss attributed to noncontrolling interests in the form of common securities and dividends on preferred stock. The following table summarizes the balances comprising accumulated other comprehensive loss, net of tax, as of December 31, 2011 and 2010:
|  | December 31,
|  | 2011 |  | 2010
|  | (in millions)
Foreign currency translation adjustment |  | $ | 1,967 |  | $ | 1,824
Unrealized derivative losses, net |  |  | 534 |  |  | 344
Unfunded pension obligations |  |  | 257 |  |  | 216
Unrealized (gain) loss on securities available for sale |  |  | - |  |  | (1)
Total |  | $ | 2,758 |  | $ | 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 transaction in additional paid-in capital. The following table summarizes the net income attributable to The AES Corporation and transfers (to) from noncontrolling interests for the years ended December 31, 2011 and 2010:
|  |  |  |  | December 31,
|  |  |  |  | 2011 |  | 2010
|  |  |  |  | (in millions)
Net income attributable to The AES Corporation |  | $ | 58 |  | $ | 9
| Transfers (to) from the noncontrolling interests: |  |  |  |  |  |
|  | Net increase in The AES Corporation's paid-in capital for sale of subsidiary shares |  |  | 19 |  |  | -
|  | Decrease in The AES Corporation's paid-in capital for purchase of subsidiary shares |  |  | - |  |  | (25)
| Net transfers (to) from noncontrolling interest |  |  | 19 |  |  | (25)
Change from net income attributable to The AES Corporation and transfers (to) from |  |  |  |  |  |
| noncontrolling interests |  | $ | 77 |  | $ | (16)

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- Definition The entire disclosure for shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, if any, including other comprehensive income (as applicable). Including, but not limited to: (1) balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings; (2) accumulated balance for each classification of other comprehensive income and total amount of comprehensive income; (3) amount and nature of changes in separate accounts, including the number of shares authorized and outstanding, number of shares issued upon exercise and conversion, and for other comprehensive income, the adjustments for reclassifications to net income; (4) rights and privileges of each class of stock authorized; (5) basis of treasury stock, if other than cost, and amounts paid and accounting treatment for treasury stock purchased significantly in excess of market; (6) dividends paid or payable per share and in the aggregate for each class of stock for each period presented; (7) dividend restrictions and accumulated preferred dividends in arrears (in aggregate and per share amount); (8) retained earnings appropriations or restrictions, such as dividend restrictions; (9) impact of change in accounting principle, initial adoption of new accounting principle and correction of an error in previously issued financial statements; (10) shares held in trust for Employee Stock Ownership Plan (ESOP); (11) deferred compensation related to issuance of capital stock; (12) note received for issuance of stock; (13) unamortized discount on shares; (14) description, terms, and number of warrants or rights outstanding; (15) shares under subscription and subscription receivables, effective date of new retained earnings after quasi-reorganization and deficit eliminated by quasi-reorganization and, for a period of at least ten years after the effective date, the point in time from which the new retained dates; and (16) retroactive effective of subsequent change in capital structure. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Article 3 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 29, 30, 31 -Article 5 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB TOPIC 4.E) -URI http://asc.fasb.org/extlink&oid=6228006&loc=d3e74512-122707 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 4 -Subparagraph (SAB TOPIC 4.C) -URI http://asc.fasb.org/extlink&oid=6959260&loc=d3e187143-122770 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 129 -Paragraph 2, 3, 4, 5, 6, 7, 8 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Glossary Preferred Stock -URI http://asc.fasb.org/extlink&oid=6521494 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 5 -Paragraph 15 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Article 4 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -URI http://asc.fasb.org/extlink&oid=6959260&loc=d3e187085-122770 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 4 -Section C Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.29-31) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Article 4 -Section 08 -Paragraph d Reference 15: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 4 -Section E Reference 16: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656 Reference 17: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 18: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(d),(e)) -URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690 Reference 19: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Research Bulletin (ARB) -Number 43 -Chapter 1 -Section B -Paragraph 7, 11A -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 20: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644 Reference 21: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Principles Board Opinion (APB) -Number 12 -Paragraph 10 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. 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