PNM’s parent company announces $11.5 billion proposed sale to Blackstone

Blackstone Infrastructure has agreed to acquire the parent company of New Mexico’s largest electricity provider, marking a potential major shift in the state’s energy landscape.

TXNM Energy Inc., the parent company of Public Service Company of New Mexico, which serves some 550,000 customers in the state, formally announced the $11.5 billion acquisition Monday morning. TXNM officials said in a news release that board members unanimously approved the acquisition agreement.

“We will continue to collaborate with customers, communities, legislators and regulators to achieve our shared goals for a reliable, resilient grid to support economic prosperity and clean energy,” TXNM Energy Chair Pat Collawn said in a statement.

Blackstone Infrastructure, which has about $60 billion in assets under management, will acquire TXNM Energy at $61.25 per share in cash upon closing, including net debt and preferred stock. Officials expect the deal to close in the second half of 2026.

Bloomberg News and Reuters reported last week that TXNM Energy was weighing a sale to Blackstone Inc.’s infrastructure investment arm. Blackstone, the parent company of Blackstone Infrastructure, is headquartered in New York and is one of the world’s largest private equity firms with more than $1 trillion in assets under management.

TXNM Energy, formerly PNM Resources Inc., hopes to move on from a failed bid to merge with Avangrid Inc. — which the New Mexico Public Regulation Commission shot down in 2021 because it said the merger would not benefit customers.

Likewise, the acquisition by Blackstone must first gain regulatory approval, including getting the OK from the PRC, which is now a three-member appointed body that has yet to approve a massive acquisition such as that between Blackstone and TXNM Energy.

Approvals must also come from the Public Utility Commission of Texas, the Federal Energy Regulatory Commission, the Department of Justice, the Nuclear Regulatory Commission and the Federal Communications Commission.

Collawn, in a Monday presentation, said filings with regulatory agencies will come together in the fall after TXNM Energy officials meet with utility stakeholders in Texas and New Mexico.

Federal regulatory approvals don’t have statutory timeframes, and neither does New Mexico, though “we expect it to take about nine to 12 months after filing,” Collawn said.

“We likely won’t file the case for 90 days,” PNM President and CEO Don Tarry added. “That allows us to engage and to listen … with our interveners, and to build some consensus as we go into that filing, or at least understanding the issues so we can address them.”

PNM and Texas-New Mexico Power Co., TXNM Energy’s other utility that covers areas throughout Texas, will remain locally managed and operated following the acquisition, Tarry said.

Tarry said Blackstone, which will delist TXNM Energy as part of the deal, has also committed not to reduce its workforce or benefits for at least two years following the transaction.

“It is core to Blackstone Infrastructure to support their communities,” Tarry said.

The announcement sent shares of TXNM Energy soaring nearly 7% on Monday to $56.57. It comes as Collawn, the longtime CEO of TXNM Energy, plans to transition into an executive chair role in July. Tarry, already president and chief operating officer of TXNM Energy and the head of PNM, will take over as chief executive of the publicly traded company.

The proposed Blackstone acquisition looks to build on the failings of a deal between TXNM Energy and Avangrid, announced in October 2020.

That deal gained regulatory approval from key entities, including federal and Texas regulators, and the endorsement of Gov. Michelle Lujan Grisham and former Attorney General Hector Balderas. But PRC commissioners denied the merger in December 2021, citing, among other things, the poor performance of Avangrid’s utilities in the Northeast.

The two companies appealed to the New Mexico Supreme Court, but the merger agreement was ultimately dissolved by Avangrid last year because the court still hadn’t decided whether the merger should be allowed.

The potential acquisition comes as PNM, in particular, is working toward integrating more renewables and shifting away from fossil fuel resources.

PNM plans to fully decarbonize — sparked by New Mexico’s 2019 Energy Transition Act — by 2040. Renewable energy sources make up around 50% of the utility’s current portfolio.

Sean Klimczak, the global head of Blackstone Infrastructure, said PNM “has done an excellent job of transitioning its generation portfolio to clean energy and supporting the communities it serves.”

“We will utilize our long-term investment approach to support PNM’s economic development efforts during New Mexico’s sustainable generation transition,” Klimczak said. “We share PNM’s deep commitment to the customers and communities they serve and we look forward to meaningfully engaging with PNM’s stakeholders.”

The sale to Blackstone Infrastructure could come with a big funding boost for those decarbonization efforts.

Blackstone Infrastructure has, in recent years, made significant investments in energy transition — including the purchase of a 20% stake in the Northern Indiana Public Service Company early last year to help fuel the utility’s move away from coal-fired generation, and a series of injections worth billions of dollars in Invenergy since 2021.

If approved, the purchase of TXNM Energy would also mark one of the largest deals to date for Blackstone Infrastructure.

But energy advocates could fiercely oppose TXNM Energy and Blackstone’s plan to win approval from New Mexico regulators — including Santa Fe-based New Energy Economy, whose objection to the PNM-Avangrid merger played a key role in the deal’s rejection.

Mariel Nanasi, executive director of NEE, said she “wasn’t surprised” by the announcement of TXNM Energy’s potential sale to Blackstone.

“The same basic considerations regarding the public interest are at issue here,” Nanasi said, citing whether the sale will provide benefits to utility customers and if the PRC’s jurisdiction will be preserved.

“That means, will the PRC be able to look into the books of Blackstone’s infrastructure fund and accounts?” Nanasi said.

Nanasi also raised concerns about Blackstone’s investment in data centers — noting the significant energy and financial resources required to operate such facilities — and questioned whether that could lead to higher costs for customers.

Blackstone in 2021 acquired the data-center developer QTS for $10 billion, turning it into one of the fastest-growing data center landlords in the country, according to Bloomberg.

“The concern with this company is: Are they going to try to buy data centers after they own the electric utility, and create an upside-down situation for rate payers and charge them … for the cost?” Nanasi said.