Iberdrola’s US subsidiary, Avangrid, and PNM continue their merger

Resources announced Wednesday that they have agreed to continue their merger, stalled while it is under review by a state regulator, and to extend the process by three months to 20 July.

The parties had signed an extension of their merger agreement extending its completion to 20 April, but believe they will not have the green light from the regulator by then, so they have extended it again, Avangrid said in a filing with the Securities and Exchange Commission.

Avangrid CEO Pedro Azagra said in a statement that the company “remains committed” to the merger, while PNM CEO Pat Vincent-Collawn, in a separate statement, said the deal “remains on track”.

“This extension will give the companies time to continue working together through the regulatory review process in New Mexico,” Avangrid said.

The deal, which would create one of the leading utilities in the US, was announced in October 2020 and approved by the US Energy Regulatory Commission (FERC) in April 2021, but soon faced hurdles that have been dragging on to this day.

In December 2021, the New Mexico Public Regulation Commission (NMPRC) rejected Avangrid’s proposal to take over PNM Resources, a decision that was appealed by both companies and referred to the US courts.

In the statement, it is recalled that the merger has received approval from five federal agencies and the Public Utility Commission of Texas.

It also notes that last month Avangrid and PNM, along with the New Mexico Public Regulation Commission, filed a joint motion for rehearing and reconsideration of the case.

All members of the NMPRC have recently been replaced, which Iberdrola chairman Ignacio Sánchez Galán referred to in his last earnings presentation, expressing confidence that the new members would have “different approaches” to those of their predecessors.