PNM Resources to sell New Mexico Renewable Development stake to Exus
PNM Resources (NYSE: PNM) has finalized an agreement to sell its 50% ownership interest in New Mexico Renewable Development, LLC (NMRD) to Exus North America Holdings, LLC. This decision, made in conjunction with American Electric Power (AEP) which also owns the remaining 50% of NMRD, involves the sale of the NMRD portfolio for an estimated $230 million.
Financial Details and Closing Expectations
PNM Resources expects to receive approximately $115 million from the gross proceeds of the sale. This capital will be allocated towards funding regulated capital investments. The completion of the sale is anticipated in February 2024, marking a significant step in PNM Resources’ strategic financial planning.
Portfolio Overview and Earnings Report
The NMRD portfolio comprises nine operating solar developments totaling 185 MW and six projects under development, estimated to produce 440 MW. PNM Resources reports earnings from this joint venture as part of its Corporate and Other segment, indicating its strategic importance to the company’s overall operations.
Strategic move: PNM Resources to divest 50% of NMRD in $230 million deal
Regulatory Approvals and Legal Proceedings
The sale is contingent upon regulatory approval by the Federal Energy Regulatory Commission and New Mexico regulatory approvals related to one of NMRD’s projects. The waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 has already expired, moving the sale closer to completion.
Advisory and Legal Support for the Transaction
KeyBanc Capital Markets has been engaged as the financial advisor, and Foley & Lardner LLP is providing legal counsel to PNM Resources and AEP in this transaction, ensuring a smooth and compliant process.
Conclusion: PNM Resources’ Strategic Focus
The sale of PNM Resources’ stake in New Mexico Renewable Development to Exus North America Holdings is a calculated move in the renewable energy sector. This transaction not only facilitates the growth of sustainable energy solutions but also aligns with PNM Resources’ focus on strengthening its financial position and investing in regulated capital ventures. The deal represents a key moment in the energy industry, highlighting the increasing value and potential of renewable energy projects.