Iberdrola has announced that it has signed a binding agreement to sell 55 percent of its business in Mexico for $6 billion.
In a statement posted on its site, the company revealed that Iberdrola Mexico and Mexico Infrastructure Partners (MIP) signed an agreement whereby a trust led and managed by MIP acquires 55 percent of the gross operating profit (EBITDA) of ‘Iberdrola in the country. The agreement includes associated contracts, more than 410 related jobs, and has the financial support of Mexico’s National Infrastructure Fund, as well as other public financial entities linked to the Mexican government, Iberdrola emphasized.
The company has indicated in the statement that it will maintain 13 plants, all its activity with private customers, and its portfolio of renewable projects “to continue increasing its wind and solar assets in the country in the coming years”. Iberdrola has added that, within the agreement, 99 percent corresponds to combined cycle gas plants and 87 percent to plants that operate under the regime of independent energy producers, contracted with the Federal Electricity Commission (CFE).
In the statement, the company highlighted that the following assets are included in the agreement; the combined cycle gas plants that operate under the regime of independent energy producers contracted with the CFE – Monterrey I and II, Altamira III and IV, Altamira V, Escobedo, La Laguna, Tamazunchale I, Baja California, Topolobampo II and Topolobampo III; the wind farm La Venta III; and the private combined cycle gas plants Monterrey III and IV, Tamazunchale II and Enertek.
Iberdrola also revealed in the release that, at a recent extraordinary session of Mexico’s Energy Regulatory Commission, the body authorized Iberdrola’s generation permit for the Santiago wind farm as the sole point of the order of the day
This wind farm is located in the state of Guanajuato and will have a power of 105 megawatts, Iberdrola said, adding that the application for the generation permit was submitted to the regulator by the Spanish company on October 13 of 2022.
The project was voted on and approved unanimously in a short session, Iberdrola said.
Iberdrola, MIP MOU
Back in April, Iberdrola announced that Iberdrola Mexico and MIP had signed a memorandum of understanding (MOU), “by which the trust led and managed by MIP will acquire 8,539 megawatts of installed capacity.”
In a company statement at the time, Iberdrola noted that the agreed value for the sale amounts to about $6 billion, but added that it may change based on the closing date of the transaction and other adjustments. Iberdrola also emphasized in April that the operation was subject to the agreement and the signing of definitive contracts by the parties, as well as to the obtaining of the necessary regulatory approvals and the fulfillment of certain usual conditions in this type of operations.
After the signing of the memorandum of understanding, the president of Iberdrola, Ignacio Galan, and the Mexican president, Andrés Manuel López Obrador, met and announced the start of a new phase, according to a published statement on the Iberdrola website in April.
“Both presidents are committed to advancing the development of renewable energies in the country,” said Iberdrola in this statement.
“The operation will have the support of the Government of Mexico through the financial support of the National Infrastructure Fund of Mexico (Fonadin) and other public financial entities,” added the company.
“Iberdrola appreciates the support and flexibility shown by the Mexican government to reach this agreement and considers Mexico a strategic country with potential for growth and expansion, where it will show its support to Mexico and the state through the development of renewable capacity,” Galán said. in the statement.
Obrador pointed out in the statement that “the agreement reached with Iberdrola, which allows progress in the implementation of Mexico’s new energy policy, marks the beginning of a new stage in which the company will actively participate in the development of renewable energies of the country”.
According to its website, Iberdrola is a world energy leader, the number one producer of wind power and one of the world’s largest electricity companies by market capitalization. As of 2022, the company had an installed capacity of 60,761 megawatts and more than 40,000 employees, its site shows. The business, which traces its roots back to 1840, is based in Bilbao, Spain.
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