Oct 20 (Reuters) - Avangrid Inc, the U.S. power
utility that is controlled by Spain's Iberdrola SA, is
in talks to acquire PNM Resources Inc, a peer active in
New Mexico and Texas that is worth more than $6 billion,
including debt, people familiar with the matter said on Tuesday.
The deal would expand Avangrid's regulated business beyond
its U.S. northeastern footprint. It would also accelerate PNM's
transition to clean energy, given Avangrid's sizeable renewable
There is no certainty that the negotiations will lead to a
deal, the sources said, requesting anonymity because the matter
is confidential. Spokespeople for Avangrid and PNM Resources did
not respond to requests for comment.
Efforts among U.S. utilities to consolidate are picking up,
amid pressure to slash costs and invest in infrastructure
improvements and cleaner forms of electricity generation.
Duke Energy Corp rebuffed a takeover approach from
NextEra Energy Inc last month, a deal which would have
created a $200 billion behemoth with operations across the U.S.
Southeast and Midwest.
Iberdrola owns a 81.6% stake in Avangrid. The Orange,
Connecticut-based company, with a market capitalization of $16.7
billion, is split into two businesses -- a regulated utility
serving more than 3.3 million customers in New York and New
England, and a division which owns and operates renewable power
generation assets across the United States.
Avangrid's experience in clean energy could prove valuable
to PNM, as it embarks on a plan it announced in July to phase
out coal from its power generation mix by 2031 and achieve
emissions-free energy by 2040.
Iberdrola has said it wants to expand its renewable capacity
in the United States by about 50 percent over four years as part
of its global plan to reduce carbon emissions.
(Reporting by Pamela Barbaglia in London and David French in
Editing by Sonya Hepinstall)