Spanish company Iberdrola has announced the sale of its Mexican assets to the Mexican government. Following the entry into office of President López Obrador, the company faced various regulatory challenges that made its operations in the country more difficult.
Iberdrola sold a total of 8,534MW, along with a 103MW wind farm, to Mexico Infrastructure Partners (MIP) for US$6 billion. The transaction was carried out through the National Infrastructure Fund of Mexico (FONADIN) and other federal financial entities.
The company noted that the sale price may be adjusted depending on the closing date and pending regulatory approvals, among other factors. "Iberdrola Mexico will continue to provide service to its current customers in Mexico (as well as, on a transitional basis, to the companies included in the scope of the transaction) for which sales contracts are expected to be signed with the transferred companies, with the aim of providing the Group's companies," says Iberdrola.
The Mexican government said that this transaction will not add to the national debt. Rogelio Ramírez de la O, Minister of Finance, states that Mexico's public budgetary debt will not be affected because FONADIN is not included in the public balance sheet. Additionally, FONADIN is capable of going to the market to refinance the transaction, which helps to prevent any impact on Mexico's public budgetary debt.
Moreover, the operation will help CFE to enhance its generation capacity in the northeast from 7% to 45%. “The willingness to reach an agreement is present. Although we have had some discrepancies, dialogue can achieve everything, along with goodwill. It is from these differences that something extraordinary, something historic emerges,” shared López Obrador through his social media.
Furthermore, López Obrador took advantage of this announcement to mention that this was another step toward the rescue of CFE. Mexico's current administration is facing an ongoing energy dispute with its North American free-trade partners due to allegations of unfair competition in the Mexican energy market. Despite the announcement on commitments from the government and some advances with certain players, the dispute has escalated as US companies have urged US President Joe Biden to pressure Mexico regarding this dispute.