Energy sector holding firm PNM Resources's New Mexico-based utility PNM has reached a definitive agreement to sell its natural gas operations to a subsidiary of utility holding firm Continental Energy Systems for $620 million.
PNM Resources also said that it will acquire Continental’s regulated Texas electric delivery business for $202.5 million in a separate transaction that is conditioned upon the sale of the natural gas operations.
PNM Resources expects to use the net proceeds of these transactions to retire debt, fund future electric capital expenditures and for other corporate purposes.
The New Mexico-based firm stated that it will acquire Continental’s Cap Rock Holding and its subsidiary Cap Rock Energy, an electric distribution and transmission company in Texas.
Jeff Sterba, chairman and CEO of PNM Resources, said: The purchase of the Texas electric assets is consistent with our strategy of focusing on a core electric business in regulated and unregulated markets. Moving forward, the sale of the gas operations and purchase of the electric operations allow PNM Resources to direct our efforts to one industry.