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A blow for Iberdrola in the United States, one of its main growth vectors. The regulator of the State of New Mexico has rejected late on Wednesday the purchase of PNM Resources by Avangrid, the subsidiary of the Spanish power company in the North American country. The no to the operation, valued at 8,300 million dollars (7,300 million euros at the current exchange rate) between cash and debt, represents a major blow to Iberdrola’s expansion strategy. All five commissioners of the regulator voted against it, claiming that it was not the best alternative for the interests of consumers.
The majority of representatives in the body had already expressed their opinion against the purchase at the hearing held last week, arguing their concern both about Avangrid’s poor record of public service in the southern state and the involvement of the president of its parent company, Ignacio Sánchez Galán, at the Villarejo case for alleged commission payments to the retired commissioner. But then it was three of the five commissioners (and not all of them, like this Wednesday) who took a position against the operation, arguing that the potential damages outweighed the benefits.
“It is not the right partner at this critical time in our energy transition,” said the regulator’s chairman, Stephen Fischmann, before the deal. Other commissioners also voiced their reluctance about the impact the corporate operation would have on public service.
Both Avangrid (Iberdrola), which has shown in a statement its “disappointment” with the regulator’s decision, and PNM Resources now have the option of requesting a new hearing. The markets, however, have already begun to discount the negative: PNM shares, which has scheduled an extraordinary meeting of its board of directors this Friday, were down 3% shortly after the vote.
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