Iberdrola México Purchase Strengthens Cox

Cox reported €69 million in net profit for 2025 and is nearing the closing of its acquisition of Iberdrola México, a US$2.65 billion transaction that will significantly scale its presence and anchor Mexico as a core market within its global water and energy platform. Mexico advances a state-led power framework under which private utilities operate alongside CFE, reshaping ownership and investment dynamics while preserving regulatory certainty. The transaction affects private power generators, infrastructure investors, regulators, and industrial electricity users as Mexico seeks to expand capacity under clearer planning rules.

Cox reported a net profit of €69 million (US$81.332 million) in 2025 and is moving toward the closing of its acquisition of Iberdrola México in March, a transaction that will reshape the company’s scale and consolidate Mexico as one of its core strategic markets. The results, published by the Spain-based water and energy utility, reflect a year of strong operational performance and accelerating international expansion, underpinned by predictable cash-generating assets and a reinforced balance sheet.

According to the company, Cox’s revenues surged 62% year on year to €1.14 billion in 2025, while EBITDA rose 23% to a record €225 million, representing a margin of 20%. Net income increased 16% compared to 2024, reinforcing management’s narrative that the firm’s dual operating model is gaining traction. The company’s Asset Co., focused on long-term infrastructure with stable returns, and its Service Co., which executes engineering, transmission and operational contracts, both contributed to the improved financial performance.

Iberdrola México Purchase Strengthens Cox

Cox President and CEO, Enrique Riquelme, described Mexico as a pivotal milestone in the group’s international roadmap, highlighting that the pending Iberdrola México transaction would elevate the company to a new operational and financial dimension.

The acquisition of Iberdrola México has already received the required regulatory approvals and is backed by a US$2.65 billion financing package supported by international financial institutions. The structure combines equity and hybrid capital, with Cox contributing between US$300 million and US$350 million from its own resources and the remainder coming from institutional investors. The transaction is expected to close in March 2026, positioning Mexico as one of Cox’s largest revenue and EBITDA contributors.

Expansion Strategy

Mexico features prominently in Cox’s expansion strategy. Alongside the Iberdrola México acquisition, the country is already one of Cox’s six strategic regions, together with Central America, Brazil, Chile, Spain, and Africa–Middle East. Last year, Riquelme mentioned Mexico accounts for more than 50% of Cox’s global investment commitments. Through 2030, the company plans to invest an additional US$6 billion in the country, divided between electricity generation and water infrastructure projects.

The executive chairman described the Mexican government’s Plan México as a framework that enables long-term corporate investment. Despite the 2025 energy reform requiring the Federal Electricity Commission (CFE) to retain a 54% share of national power generation, Riquelme characterized the current legal framework as “fair” and conducive to private investment certainty.

Beyond Mexico, Cox continued to add assets in 2025 under strict investment criteria. These included two solar plants in Panama totaling 24MW, the expansion of the Agadir desalination complex in Morocco to 400,000m3 per day of water capacity and 150MW of wind power, a new water concession in Angola, and major solar, storage and transmission projects in Ecuador and Brazil. These additions reinforce the company’s profile as an integrated water and energy utility with diversified geographic exposure.

Financially, Cox closed 2025 with a net debt to EBITDA ratio of 0.9x, reflecting conservative leverage despite rapid growth. Operating cash flow reached €127 million, with a cash conversion ratio of 56 percent, supporting the company’s investment plan for 2026–2028 presented at its recent Capital Markets Day. That plan envisions continued expansion in regulated and contracted assets, with Mexico playing a central role following the Iberdrola transaction.

For Mexico’s energy sector, the deal underscores a broader trend previously analyzed by Mexico Business News: the reconfiguration of ownership among private power generators as the country seeks to expand capacity under clearer, state-led planning frameworks. If completed as scheduled, Cox’s acquisition of Iberdrola México would mark one of the most significant utility transactions in recent years, reshaping the competitive landscape while anchoring a new long-term investor in the Mexican power market.