By Olivia Bugault

 

New Mexico regulators rejected the proposed acquisition of PNM Resources Inc. by Iberdrola SA's U.S. unit Avangrid Inc., electricity services company PNM resources said early Thursday.

The New Mexico Public Regulation Commission unanimously voted to deny the merger agreements reached by the companies involved, U.S. company PNM Resources said.

Last year, the companies announced their plans to merge with Avangrid offering to buy PNM resources for an enterprise value of $8.3 billion.

PNM and Avangrid both said they were disappointed with the decision. "We put forth an agreement that would strengthen New Mexico's future as we partnered with a global company to meet the challenges of climate change while ensuring affordable and reliable service to PNM customers for years to come," PNM Resources Chief Executive Officer Pat Vincent-Collawn said. Avangrid said it is assessing its next steps.

"The reasons provided by New Mexican Commissioners are service issue concerns due to Avangrid's operating record as well as a lack of sufficient benefit to ratepayers," Royal Bank of Canada's analysts said, adding that "now Iberdrola will have to say if it will continue fighting for this acquisition or move on to other opportunities."

The proposed merger had already been approved by several federal agencies as well as the public utilities commission of Texas, PNM Resources said.

 

Write to Olivia Bugault at olivia.bugault@wsj.com

 

(END) Dow Jones Newswires

December 09, 2021 05:26 ET (10:26 GMT)

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