Iberdrola has decided to cancel its merger agreement with the American electricity company PNM Resources considering that "the expected conditions have not been met," as indicated in a note sent to the National Securities Market Commission (CNMV).
With this decision, the company puts an end to a project presented in 2020 that would have allowed it to create one of the largest companies in the sector in the United States, with ten regulated electricity companies spread across New York, Connecticut, Maine, Massachusetts, New Mexico and Texas. .
The operation would have been the second largest in the history of Iberdrola, only behind the purchase of the Scottish company Scottish Power in 2009. Through Avangrid, in which the Spanish company has 85% of the capital, it would have been formed a group with a company value close to 8.3 billion dollars (7 billion euros).
In addition to delays in permits, the operation was rejected in 2021 by the New Mexico regulator, which vetoed it when detecting risks greater than the foreseeable benefits. Among the arguments used, he alluded to the 'Villarejo case', the consequences of which at that time were unknown.
Iberdrola appealed this decision before the Supreme Court of New Mexico, considering that it is “unfair” and that the operation, "friendly and recommended by the board of directors of PNM Resources", had the support of interest groups and had received the approval of different state and federal agencies.
Avangrid, listed in New York, subsequently announced to the US market supervisor, the SEC, that the parties would be given until April 20, 2023 to close a definitive agreement and that, from that moment on, either of them would have freedom to terminate it.
Iberdrola has not stopped defending a project that would integrate its capabilities as a third renewable product in the United States with conventional distribution assets to form a large electricity company with a presence in several states. The combination of the two companies would have provided more than 4 million supply points in the country.
Iberdrola's price responded this Tuesday to the announcement with a 1% increase in the value of the shares, up to 12 euros. The company capitalizes more than 76,000 million euros.
