Background on Iberdrola and Cox
Iberdrola, a prominent Spanish energy company with interests in water and renewable energy, has agreed to sell its Mexican assets to Cox, another Spanish company specializing in water and renewable energy services. The transaction values Iberdrola México at $4.2 billion.
The Acquisition Details
Cox confirmed the acquisition to the European equity market, taking over not just 15 wind parks but Iberdrola México’s entire business and assets. The deal includes the transfer of Iberdrola’s Mexican subsidiary’s capital stock.
The transaction’s final value may change depending on the closing date, expected between Q4 2025 and Q1 2026. Adjustments are common in such operations.
Regulatory and Permit Conditions
The sale is subject to regulatory conditions and permits, including authorization from Mexico’s National Energy Commission (CENACE) and the National Antimonopoly Commission.
Additionally, it requires formal approval from Cox’s shareholders holding 84% of the capital. However, key reference shareholders representing over 84% have committed to voting in favor of the deal at the general meeting.
Iberdrola’s Challenges in Mexico
Iberdrola has faced regulatory uncertainty in Mexico’s electricity market, as detailed in their 2024 report “Incertidumbre regulatoria en el mercado eléctrico mexicano.” Delays in customer registration for the new market scheme have prevented Iberdrola from supplying these customers, forcing them to sell energy in the spot market.
Between 2023 and 2024, Iberdrola’s Mexican revenue dropped by 43%, falling to €1.721 billion, compared to €4.079 billion in 2022.
Possible Reasons for the Sale
The Mexican Wind Energy Association (AMDEE) suggests Iberdrola’s divestment might be due to their focus on transmission and distribution of energy globally. These activities are constitutionally reserved for the Mexican state.
After selling 55% of its Mexican capacity to the Federal Electricity Commission (CFE) earlier in 2024, Iberdrola retained ownership of six wind parks with a combined 590 megawatts.
- PIER: 221 megawatts in Puebla
- PIER II: 66 megawatts in Puebla
- Santiago: 105 megawatts in Guanajuato
- Bii Nee Stipa: 26 megawatts in Oaxaca
- Parques Ecológicos de México: 102 megawatts in Oaxaca
Along with 11 other plants, primarily combined-cycle facilities, Cox acquired 15 power plants totaling 2,600 megawatts. Mexico’s system has a total capacity of 90,000 megawatts.
Key Questions and Answers
- Who are Iberdrola and Cox? Iberdrola is a Spanish energy company with interests in water and renewable energy, while Cox specializes in water and renewable energy services.
- What assets did Cox acquire from Iberdrola México? Cox purchased 15 wind parks and Iberdrola México’s entire business and assets, totaling 2,600 megawatts.
- What challenges has Iberdrola faced in Mexico? Iberdrola has encountered regulatory uncertainty and delays in customer registration, forcing them to sell energy in the spot market.
- Why might Iberdrola have decided to divest from Mexico? Iberdrola may be focusing on transmission and distribution of energy globally, activities reserved for the Mexican state.
- What is the significance of this acquisition for Cox? This acquisition allows Cox to expand its presence in Mexico’s energy market and potentially capitalize on transmission and distribution opportunities.
