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Information technology services industry

PNM Resources to Merge with AVANGRID: Key Updates and Implications

Strategic Insights

— 2 min read

PNM Resources, a New Mexico corporation, has entered into an Agreement and Plan of Merger with AVANGRID, a New York corporation, and NM Green Holdings, Inc., a New Mexico corporation and a wholly-owned subsidiary of AVANGRID. The merger, subject to customary closing conditions and approvals, will result in PNM Resources being delisted from the New York Stock Exchange and deregistered under the Securities Exchange Act of 1934. Under the terms of the merger, each issued and outstanding share of PNM Resources common stock will be converted into the right to receive $50.30 in cash.

The termination of the PNM Resources, Inc. Direct Plan, which allows participants to purchase shares of PNM Resources common stock, has been amended to terminate the right to purchase shares with respect to any cash dividends and first-time or optional cash investments not received by noon Eastern Time on November 17, 2020. Participants enrolled in the dividend reinvestment portion of the plan will have their cash dividends reinvested to purchase shares of PNM Resources common stock up to November 17, 2020.

Key Takeaways:

  • PNM Resources will merge with AVANGRID through NM Green Holdings, Inc., with PNM Resources surviving as a direct wholly-owned subsidiary of AVANGRID.
  • The merger will result in the delisting of PNM Resources common stock from the New York Stock Exchange and deregistration under the Securities Exchange Act of 1934.
  • Each issued and outstanding share of PNM Resources common stock will be converted into the right to receive $50.30 in cash.
  • The PNM Resources, Inc. Direct Plan will terminate the right to purchase shares with respect to any cash dividends and first-time or optional cash investments not received by November 17, 2020.
  • Existing shareholders will not be permitted to have subsequent cash dividends reinvested in additional shares of PNM Resources common stock under the plan after November 17, 2020.
  • PNM Resources will terminate the Plan and expects that each share of PNM Resources common stock acquired under the plan prior to November 17, 2020 will remain unaffected by the termination.
  • PNM Resources and AVANGRID may be deemed to be participants in the solicitation of proxies in connection with the proposed transaction.
  • PNM Resources has filed a proxy statement with the SEC regarding the proposed business combination transaction with AVANGRID.

Statistics:

  • $50.30: The amount in cash that each issued and outstanding share of PNM Resources common stock will be converted into in connection with the merger.
  • November 17, 2020: The deadline for receiving cash dividends and first-time or optional cash investments to purchase shares of PNM Resources common stock under the PNM Resources, Inc. Direct Plan.
  • November 18, 2020: The date by which funds related to the cash dividend payable on November 13, 2020 that are not used to purchase shares of PNM Resources common stock or to pay requisite expenses will be returned to plan participants.

Sources:

  • PNM Resources, Inc. Direct Plan (the "Plan")
  • Computershare Trust Company, N.A. (Plan Administrator)
  • Proxy Statement (PNM Resources' 2020 Annual Meeting of Shareholders)
  • Form 10-K (PNM Resources, filed with the SEC on March 2, 2020)
  • Prospectus Supplement (dated November 2, 2020)

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