AVANGRID will issue an aggregate of $4,000 million of common stock in a private placement transaction at $51.40 per share, the closing price as of 11th May 2021. Iberdrola will subscribe $3,260 million proportionally to its current 81.5% participation and Qatar Investment Authority (“QIA”) will subscribe the additional $740 million acquiring approximately 3.7% of AVANGRID common stock.
This transaction will reinforce the strategic partnership between Iberdrola and QIA.
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.”
Dennis V. Arriola, AVANGRID’s CEO 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.”
A portion of the proceeds of this capital increase will fund AVANGRID’s proposed merger with PNM Resources, Inc., and pay off the intra-group loan agreement with Iberdrola, which provided AVANGRID with an unsecured subordinated loan in an aggregate principal amount of $3 billion.
A portion of the proceeds of this capital increase will also be contributed to fund AVANGRID’s investment plan, financing its announced future growth with over $20 billion of organic investments through 2025.
AVANGRID’s investment plan will be focused on regulated and contracted investments that generate predictable earnings and growing cash flows in networks infrastructures. Projects will include the contracted transmission line NECEC and power grid modernization, as well as in renewable energy – mainly contributing to offshore wind power development in the U.S., with projects such as Vineyard Wind and Park City Wind and investments in onshore wind energy and solar projects.