The agreement has had the unanimous favourable vote of the members of the Boards of Directors of both Avangrid and Iberdrola, Iberdrola said on 17 May.
The transaction is still subject to requisite shareholder approval and approval from various regulators, such as the Federal Energy Regulatory Commission (FERC) and the state regulatory commissions of New York and Maine. After the transaction is closed, a request will be made to delist Avangrid’s shares from the New York Stock Exchange.
“The objective of this transaction is to increase exposure to the networks business in the United States at a key moment for Iberdrola, which wants to grow in markets with strong credit ratings and in regulated businesses such as networks,” the Spanish renewable energy major said.
Avangrid has two main business areas: networks and renewable energy. Through the networks business, Iberdrola’s US arm owns and operates eight electric and natural gas companies, and through its renewable energy business, Avangrid owns and operates a portfolio of renewable energy generation facilities.
In the transmission and distribution grid business, Iberdrola’s investments in the US are aimed at modernisation and digitalisation to increase the quality of service and resilience to extreme weather events and to enable the integration of more clean energy into the system, the company said in 2023 when it launched a grid upgrade project in New York.
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In renewable energy, the US investments Iberdrola is making until 2025 will lead to a renewable capacity of approximately 10 GW, according to the company.
Avangrid is the third largest renewable energy company in the US by installed capacity and has an offshore wind portfolio of projects in the country of more than 6 GW, according to information Iberdrola shared last year.
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