New Mexico utility regulators rule PNM, private equity firm must undo controversial $400M stock sale

New Mexico utility regulators on Thursday voted 2-1 that PNM and Blackstone Infrastructure, the state’s largest electricity provider and the private equity firm seeking to acquire it, must undo a $400 million stock sale. That vote does not impact the overall pending merger.

The vote came as hundreds of residents shuffled through the hallways of the Roundhouse in Santa Fe and crammed into a legislative committee room that was too small for them. Commissioners had to briefly suspend the meeting while they sought a room that could accommodate the massive turnout.

The state Public Regulation Commission’s staff in June found that PNM and a Blackstone affiliate violated state law when the affiliate company purchased $400 million of stock in PNM’s parent company in 2025 without PRC approval.

State Attorney General Raúl Torrez also has raised concerns about the sale, as have state lawmakers as well as environmental and consumer advocacy groups.

PRC staff subsequently recommended that commissioners impose multiple $100,000 penalties on the involved parties. At the time, they also wrote that the “procedural integrity and fundamental fairness may require” both parties to withdraw their application for the merger and file a new one that more reflects the steps taken to address the stock sale.

Commissioner Greg Nibert, who ultimately cast the lone “no” vote, began the commission’s discussion on the decision after public comment concluded Thursday. He said he agreed that PNM and the Blackstone affiliates, Troy TopCo and Troy ParentCo, broke the law, but he voiced concern that ordering PNM or its parent company, TXNM Energy Inc., to pay the $400 million back could hurt New Mexico ratepayers.

“That thought has troubled me for several weeks now,” Nibert said during the hearing. “I think we have to recognize that TXNM does not have $400 million to write a check to TopCo.”

Nibert said he feared that the electric company would have to borrow money to pay off the $400 million in question, which could make it more difficult to do business in New Mexico.

Commissioner Gabriel Aguilera responded by reminding Nibert that the recommended decision before them contained language to make sure ratepayers are “held harmless.”

“When you drill down into it, really what happened is PNM has deprived the commission of an ability to look at whether those funds were used prudently,” Aguilera said. “I hear you that this could potentially hurt PNM when they’re seeking financing in the credit market, but this is an issue of their own doing.”

In addition to undoing the stock sale, commissioners also imposed $300,000 of fines on the involved parties.

Before the hearing began, dozens of New Mexicans gathered outside the Roundhouse to protest the proposed acquisition.

Terry Davis of Albuquerque hoisted a sign reading “Blackstone will exploit New Mexico” in the air and told Source NM he was worried that the acquisition would raise electricity rates across the state. He also said he was concerned it would facilitate the construction of data centers, citing one of its affiliates’ investments in data centers around the world.

Asked whether he thought commissioners would find that PNM and Blackstone broke the law, he said: “That better be what happens.”

The PRC hearing had to relocate in the Roundhouse shortly after it began in a small legislative committee room on the Capitol’s third floor. Residents packed the room and spilled into the hallways overlooking the Roundhouse’s rotunda. Commissioners called for a recess and moved the meeting into a more spacious room, where Commissioner Pat O’Connell repeatedly pounded his gavel on the dais and ordered a rowdy crowd to quit heckling supporters of the acquisition and to stop clapping for opponents.

Two state lawmakers, Sen. Gabriel Ramos (R-Silver City) and Rep. Meredith Dixon (D-Albuquerque) spoke in support of the acquisition during Thursday’s hearing.

“Rates will continue to be set with PRC oversight. PNM’s workforce, leadership and headquarters will continue to remain in New Mexico with existing union agreements intact,” Dixon, who appeared virtually, told commissioners.

Residents who spoke during the public comment period — appearing both online and in-person — overwhelmingly asked commissioners to rule that PNM and Blackstone broke the law.

“When we look at our children, it’s impossible not to think about what kind of world we’re bringing them into,” Albuquerque resident Sadie Gonzales-Root told commissioners. “Today is when you decide what New Mexico our children will inherit.” 

Albuquerque resident Michael Sweringen approached the microphone to address commissioners with a breakfast burrito in his hand. He came that morning, he told them, to offer a “visual demonstration” of what happens to companies after a private equity acquisition.

“It could be yours for $5. Now, private equity got involved. Well, it’s kind of shrunk a little bit,” he said, to laughs in the audience. “The bacon was too expensive, so they substituted turkey bacon. The cheese was too expensive, we’re using lesser quality. And instead of green chiles, green food coloring will do. It could be yours for $7.”

Sen. Harold Pope (D-Albuquerque), a candidate for lieutenant governor who’s been a vocal critic of the proposed acquisition, told Source NM after the vote that it put the power of the constituent on display.

“I think it’s what people wanted…I wish it would’ve been unanimous,” he said.

Environmental advocates similarly praised the commission’s decision.

Mariel Nanasi, executive director of the Santa Fe-based clean energy advocacy organization New Energy Economy, which has frequently intervened in the case, in a statement said the commissioners made the right decision but should have also thrown the acquisition out altogether.

“We are pleased that the Commission adopted the Hearing Examiners’ findings that Blackstone and TXNM violated New Mexico law and that the unlawful $400 million stock transaction must be unwound at shareholder — not ratepayer — expense,” she wrote. “However, the Commission should also have denied the merger application.”

A spokesperson for Blackstone declined to comment.

A statement provided by PNM and TXNM Energy said the latter “is reviewing the final order on the stock transaction and will evaluate the options and next steps within the established regulatory and legal framework. Our priority continues to be delivering safe, reliable, and affordable power to the communities we serve while ensuring that our actions align with New Mexico’s regulatory requirements. It is important to us that our customers know that the stock issuance was completed in good faith, publicly disclosed well in advance and undertaken with no intent to circumvent any rules or regulatory requirements.”