FCC Approves Transfer of Licenses Related to AVANGRID’s Proposed PNM Resources Merger

Rhea-AI Summary

AVANGRID (NYSE: AGR) has received approval from the FCC for the transfer of operating licenses related to its proposed merger with PNM Resources (NYSE: PNM). This follows the recent green light from PNM Resources' shareholders and clearance from CFIUS. The merger, originally announced in October 2020, involves an all-cash offer of $50.30 per share, valuing the transaction at $8.3 billion. The combined entity aims to enhance clean energy delivery across New Mexico and Texas, while further regulatory approvals are still pending.

Positive

• FCC approval for operating license transfer received.
• Shareholder approval from PNM Resources obtained.
• Transaction valued at $8.3 billion, indicating a significant business expansion.
• Strategically enhances AVANGRID's position in the clean energy market.

Negative

• Further regulatory approvals needed from multiple entities, including FERC and state commissions.
• Potential delays in completing the merger could impact projected benefits.

AVANGRID, Inc. (NYSE: AGR), a leading sustainable energy company, announced today that it has received the approval of the transfer of operating licenses from the Federal Communications Commission (FCC) related to the proposed PNM Resources (NYSE: PNM) merger.

“We are pleased with the continued progress of the required regulatory approvals for this transaction,” said Dennis V. Arriola, CEO of AVANGRID. “Combining AVANGRID and PNM Resources will bring together two companies committed to a clean energy future with a transaction that will deliver tangible benefits for customers in New Mexico and Texas.”

Today’s announcement follows the recent approval of the merger by PNM Resources’ shareholders, the receipt of regulatory clearance from the Committee on Foreign Investment in the United States (CFIUS) and the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act.

The company continues to pursue state and Federal regulatory approvals for the merger, including from the Nuclear Regulatory Commission and the Federal Energy Regulatory Commission (FERC), as well as the New Mexico Public Regulation Commission and the Public Utility Commission of Texas.

AVANGRID announced the strategic PNM Resources merger combination in October 2020 in an all cash offer for PNM Resources’ shares at $50.30 per share, an $8.3 billion enterprise value transaction. The resulting entity would be one of the major clean energy companies in the U.S. with ten regulated utilities in six states and the third largest renewables company with operations in 24 states.

About AVANGRID: AVANGRID, Inc. (NYSE: AGR) aspires to be the leading sustainable energy company in the United States. Headquartered in Orange, CT with approximately $38 billion in assets and operations in 24 U.S. states, AVANGRID has two primary lines of business: Avangrid Networks and Avangrid Renewables. Avangrid Networks owns and operates eight electric and natural gas utilities, serving more than 3.3 million customers in New York and New England. Avangrid Renewables owns and operates a portfolio of renewable energy generation facilities across the United States. AVANGRID employs approximately 7,000 people and has been recognized by Forbes and Just Capital as one of the 2021 JUST 100 companies – a list of America’s best corporate citizens – and was ranked number one within the utility sector for its commitment to the environment and the communities it serves. The company supports the U.N.’s Sustainable Development Goals and was named among the World’s Most Ethical Companies in 2021 for the third consecutive year by the Ethisphere Institute. For more information, visit www.avangrid.com.

Forward-Looking Statements

Certain statements made in this press release for AVANGRID that relate to future events or expectations, developments, projections, estimates, intentions, goals, targets, and strategies are made pursuant to the Private Securities Litigation Reform Act of 1995. All statements contained in this Press Release that do not relate to matters of historical fact should be considered forward-looking statements, and are generally identified by words such as “may,” “will,” “would,” “can,” “expect(s),” “intend(s),” “anticipate(s),” “estimate(s),” “believe(s),” “future,” “could,” “should,” “plan(s),” “aim(s),” “assume(s)”, “project(s)”, “target(s)”), “forecast(s)”, “seek(s)” and or the negative of such terms or other variations on such terms, comparable terminology or similar expressions. These forward-looking statements generally include statements regarding the potential transaction between AVANGRID and PNM Resources, including any statements regarding the expected timetable for completing the potential merger, the ability to complete the potential merger, the expected benefits of the potential merger, projected financial information, future opportunities, and any other statements regarding AVANGRID’s and PNM Resources’ future expectations, beliefs, plans, objectives, results of operations, financial condition and cash flows, or future events or performance. Readers are cautioned that all forward-looking statements are based upon current reasonable beliefs, expectations and assumptions. AVANGRID assumes any obligation to update this information. Because actual results may differ materially from those expressed or implied by these forward-looking statements, AVANGRID cautions readers not to place undue reliance on these statements.

AVANGRID’s business, financial condition, cash flow, and operating results are influenced by many factors, which are often beyond its control, that can cause actual results to differ from those expressed or implied by the forward-looking statements. For a discussion of risk factors and other important factors affecting forward-looking statements, please see AVANGRID’s Form 10-K and Form 10-Q filings and the information filed on Avangrid’s Forms 8-K with the Securities and Exchange Commission (the “SEC”) as well as its subsequent SEC filings, and the risks and uncertainties related to the proposed merger with PNM Resources, including, but not limited to: the expected timing and likelihood of completion of the pending merger, including the timing, receipt and terms and conditions of any required governmental and regulatory approvals of the pending merger that could reduce anticipated benefits or cause the parties to abandon the transaction, the failure by AVANGRID to obtain the necessary financing arrangement set forth in commitment letter received in connection with the Merger, the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement, the risk that the parties may not be able to satisfy the conditions to the proposed Merger in a timely manner or at all, risks related to disruption of management time from ongoing business operations due to the proposed Merger, and the risk that the proposed transaction and its announcement could have an adverse effect on the ability of PNM Resources to retain and hire key personnel and maintain relationships with its customers and suppliers, and on its operating results and businesses generally. Other unpredictable or unknown factors not discussed in this communication could also have material adverse effects on forward looking statements. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.

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FAQ

What is the significance of AVANGRID's merger with PNM Resources?

The merger is aimed at enhancing clean energy service delivery across New Mexico and Texas, combining resources for greater impact.

What was the transaction value for AVANGRID's acquisition of PNM Resources?

The transaction is valued at $8.3 billion, offering $50.30 per share in cash for PNM Resources.

What regulatory approvals are still required for the AVANGRID and PNM merger?

Further approvals are needed from the Nuclear Regulatory Commission, Federal Energy Regulatory Commission, and state public utility commissions.

When did AVANGRID announce its merger with PNM Resources?

The merger was originally announced in October 2020.

How does the merger impact AVANGRID's market position?

The merger positions AVANGRID as a major player in the clean energy sector, with ten regulated utilities in six states.