Global energy and electricity provider Iberdrola announced today that its majority owned US utility company AVANGRID will issue $4 billion of common stock, with Iberdrola subscribing $3.26 billion proportionally to its current 81.5% stake, and Qatar Investment Authority investing $740 million for approximately 3.7% of the company’s common stock.
AVANGRID is the third largest wind operator in the U.S., and is a leading sustainable energy company with more than 7.4 gigawatts of installed wind and solar capacity. In October 2020, AVANGRID announced an agreement to acquire PNM Resources at an $8.3 billion enterprise value, creating one of the largest companies in the U.S. utility industry, and the third largest renewable energy operator in the United States.
Mansoor Al-Mahmoud, Chief Executive Officer of QIA said:
“We are delighted to strengthen our strategic partnership with Iberdrola through our investment in AVANGRID. We share a common vision with Iberdrola for a low-carbon future. AVANGRID is a high-quality utility and a leader in renewables in the U.S. market, with strong growth potential. Our investment in AVANGRID is a further demonstration of QIA’s strategy to increase the size of our U.S. portfolio, as well as our commitment to support decarbonisation through environmental and social impact investments.”
Proceeds from the capital raise will be used in part to fund the proposed acquisition of PNM, as well as contributing to the company’s future growth plans, with over $20 billion of organic investments expected through 2025.
Dennis V. Arriola, CEO of AVANGRID’s said:
“The significant investments by Iberdrola and QIA demonstrate strong confidence in AVANGRID’s strategy and will help fund our journey to becoming the leading sustainable energy company in the U.S.”