Today Avangrid, Inc. (NYSE: AGR) (“Avangrid” or the “Company”),
a leading sustainable energy company, and a member of the group of
companies controlled by Iberdrola, S.A. (“Iberdrola”), announced
that Institutional Shareholder Services Inc. (“ISS”) and Glass,
Lewis & Co. LLC (“Glass Lewis”), two leading independent proxy
firms, have both recommended that Avangrid shareholders vote “FOR”
the adoption of the Agreement and Plan of Merger (the “Merger
Agreement”), dated as of May 17, 2024, by and among Iberdrola,
S.A., a corporation organized under the laws of Spain
(“Iberdrola”), Arizona Merger Sub, Inc., a New York corporation and
wholly-owned subsidiary of Iberdrola (“Merger Sub”), and Avangrid
(the “Merger Agreement Proposal”). The Merger Agreement provides
that, upon the terms and subject to the satisfaction or waiver of
the conditions set forth therein, Merger Sub will merge with and
into Avangrid (the “Merger”), with Avangrid continuing as the
surviving corporation and a wholly-owned subsidiary of
Iberdrola.
“We are appreciative of the proxy advisory firms’ votes of
confidence in the proposed Merger,” said Pedro Azagra, Avangrid
CEO. “We urge all of Avangrid’s shareholders to follow the
recommendations of these independent authorities and the Avangrid
Board of Directors by voting “FOR” the Merger Agreement Proposal,
as a failure to vote is the equivalent of a vote against the Merger
Agreement Proposal.”
Both ISS and Glass Lewis considered the following key factors in
making their recommendations:1
- That the Merger proposal presents an incremental market premium
to investors;
- that the Avangrid Board of Director’s (the “Board”) delegation
of authority with respect to consideration of all aspects of the
proposal to its Unaffiliated Committee, comprised of independent
directors not affiliated with Iberdrola, created appropriate
governance mechanisms;
- that a committee of independent and disinterested directors of
the Board (the “Unaffiliated Committee”) evaluated the proposed
Merger, with the assistance of its own independent legal and
financial advisors, and the Unaffiliated Committee concluded that
the proposed Merger as fully negotiated was fair to Avangrid’s
unaffiliated shareholders; and
- that the Company faces material capital investment requirements
through 2030 (many of which are driven by regulatory mandate and
therefore obligatory), which, on a stand-alone basis, would require
Avangrid, beginning in 2025, to pursue near-term, dilutive equity
issuances, capital rotations or partnerships, and/or a reduction in
the Company’s current dividend.
The recommendations follow recent action by the U.S. Federal
Energy Regulatory Commission (“FERC”) approving Iberdrola’s
acquisition of the remaining 18.4% of the issued and outstanding
shares of common stock of Avangrid that it does not currently own.
The consummation of the Merger remains subject to the satisfaction
of other closing conditions, including receipt of the approval of
the Maine Public Utilities Commission, the New York Public Service
Commission and the Company Shareholder Approval (as defined
below).
On May 17, 2024, the Board, acting on the unanimous
recommendation of the Unaffiliated Committee that led the
consideration of strategic alternatives and the negotiation of the
terms of the Merger Agreement, unanimously approved the Merger
Agreement, which is subject to a number of customary conditions,
including affirmative votes of (1) the holders of a majority of all
outstanding shares of common stock of Avangrid, (2) the holders of
a majority of all outstanding shares of common stock held by
Avangrid’s shareholders other than Iberdrola, its subsidiaries, and
their controlled affiliates and (3) the holders of a majority of
the outstanding shares of Avangrid common stock other than
Iberdrola, Arizona Merger Sub, Inc., their affiliates, any members
of the Board who are employed by Iberdrola or its affiliates, any
officer of Avangrid and any family members, affiliates or
associates of the foregoing (collectively, the “Company Shareholder
Approval”).
The Board unanimously recommends that Avangrid shareholders vote
“FOR” each of the proposals to be considered at the annual meeting,
which will be held on Thursday, September 26, 2024, at 8:30 a.m.
Eastern Time in Boston, Massachusetts. EVERY VOTE IS VERY
IMPORTANT. Avangrid shareholders who have any questions
concerning the Merger or the proxy statement or would like
additional copies or need help voting their shares of Avangrid
common stock, please contact Avangrid’s proxy solicitors:
For U.S. Holders of Avangrid common stock:
Okapi Partners LLC 1212 Avenue of the Americas, 17th Floor New
York, NY 10036, USA Telephone for Banks, Brokers, and International
Shareholders: (212) 297-0720 Shareholders may call toll-free (from
the U.S. and Canada): (877) 279-2311 Email:
info@okapipartners.com
For Non-U.S. Holders of Avangrid common stock:
Georgeson LLC c/Orense 34, Edificio Norte, 8ª Planta, 28020
Madrid, Spain Telephone for Banks, Brokers and Shareholders: (+44)
370 703 0282
About Avangrid
Avangrid (NYSE: AGR) aspires to be the leading sustainable
energy company in the United States. Headquartered in Orange, CT
with approximately $45 billion in assets and operations in 24 U.S.
states, Avangrid has two primary lines of business: networks and
renewables. Through its networks business, Avangrid owns and
operates eight electric and natural gas utilities, serving more
than 3.3 million customers in New York and New England. Through its
renewables business, Avangrid owns and operates a portfolio of
renewable energy generation facilities across the United States.
Avangrid employs approximately 8,000 people and was recognized by
JUST Capital as one of the JUST 100 companies – a ranking of
America’s best corporate citizens – in 2024 for the fourth
consecutive year. In 2024, Avangrid ranked first within the utility
sector for its commitment to the environment. The company supports
the U.N.’s Sustainable Development Goals and was named among the
World’s Most Ethical Companies in 2024 for the sixth consecutive
year by the Ethisphere Institute. Avangrid is a member of the group
of companies controlled by Iberdrola. For more information, visit
https://www.avangrid.com.
About Iberdrola
Iberdrola, Europe’s largest electricity utility by market
capitalization and one of the world's top three electricity
companies, is a leader in renewables, spearheading the energy
transition to a low carbon economy. The group supplies energy to
almost 100 million people in dozens of countries. With a focus on
renewable energy, smart networks and smart solutions for customers,
Iberdrola’s main markets include Europe (Spain, the United Kingdom,
Portugal, France, Germany, Italy and Greece), the United States,
Brazil, Mexico and Australia.
The company has a workforce of over 42,200 and assets in excess
of €150 billion. In 2023, Iberdrola posted revenues of nearly €50
billion, net profit of €4.8 billion, with nearly €9.3 billion paid
in tax contributions in the countries where it operates. The
company helps to support more than 500,000 jobs in communities
across its supply chain, and global supplier purchases topped €18.1
billion in 2023. A benchmark in the fight against climate change,
Iberdrola has invested more than €150 billion over the past two
decades to help build a sustainable energy model, based on sound
environmental, social and governance (ESG) principles.
Additional Information and Where to Find It
In connection with the proposed transaction, Avangrid has filed
with the Securities and Exchange Commission (“SEC”) and has
furnished to shareholders a proxy statement (the “Proxy Statement”)
and Avangrid and Iberdrola have jointly filed a transaction
statement on Schedule 13E-3 (the “Schedule 13E-3”). Avangrid or
Iberdrola may also file other documents with the SEC regarding the
proposed transaction. INVESTORS AND SHAREHOLDERS OF AVANGRID ARE
URGED TO CAREFULLY READ THE PROXY STATEMENT AND THE SCHEDULE 13E-3
IN THEIR ENTIRETY AND ANY OTHER DOCUMENTS FILED WITH THE SEC IN
CONNECTION WITH THE PROPOSED TRANSACTION OR INCORPORATED BY
REFERENCE THEREIN BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION AND THE PARTIES TO THE
PROPOSED TRANSACTION. Avangrid’s investors and shareholders may
obtain free copy of the Proxy Statement and other documents free of
charge on Avangrid’s website at www.avangrid.com. In addition,
Avangrid’s investors and shareholders may obtain free copy of the
Proxy Statement, the Schedule 13E-3 and other documents, once such
documents are filed with the SEC (when available) from the SEC’s
website at www.sec.gov.
Participants in the Solicitation
Avangrid and its directors, executive officers, other members of
its management and employees may be deemed to be participants in
the solicitation of proxies of Avangrid shareholders in connection
with the proposed transaction under SEC rules. Investors and
shareholders may obtain more detailed information regarding the
names, affiliations and interests of Avangrid’s executive officers
and directors in the solicitation by reading the Proxy Statement,
Schedule 13E-3, the Annual Report on Form 10-K for the fiscal year
ended December 31, 2023, as amended by the Form 10-K/A filed on
April 26, 2024, and other relevant materials that will be filed
with the SEC in connection with the proposed transaction when they
become available. To the extent holdings of securities by potential
participants (or the identity of such participants) have changed
since the information printed in the Proxy Statement, such
information has been or will be reflected on Avangrid’s Statements
of Change in Ownership on Forms 3 and 4 filed with the SEC.
Information concerning the interests of Avangrid’s participants in
the solicitation, which may, in some cases, be different than those
of the Avangrid’s shareholders generally, are set forth in the
Proxy Statement.
Forward-Looking Statements
Certain statements in this report may relate to our future
business and financial performance and future events or
developments involving us and our subsidiaries that are not purely
historical and may constitute “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements may be identified by the use of
forward-looking terms such as “may,” “will,” “should,” “would,”
“could,” “can,” “expect(s),” “believe(s),” “anticipate(s),”
“intend(s),” “plan(s),” “estimate(s),” “project(s),” “assume(s),”
“guide(s),” “target(s),” “forecast(s),” “are (is) confident that”
and “seek(s)” or the negative of such terms or other variations on
such terms or comparable terminology. These forward-looking
statements generally include statements regarding the potential
transaction between Avangrid and Iberdrola, including any
statements regarding the expected timetable for completing the
potential transaction, the ability to complete the potential
transaction, the expected benefits of the potential transaction,
projected financial information, future opportunities, and any
other statements regarding Avangrid’s future expectations, beliefs,
plans, objectives, results of operations, financial condition and
cash flows, or future events or performance. Readers are cautioned
that all forward-looking statements are based upon current
reasonable beliefs, expectations and assumptions. Avangrid’s
business, financial condition, cash flow, and operating results are
influenced by many factors, which are often beyond its control,
that can cause actual results to differ from those expressed or
implied by the forward-looking statements. For a discussion of risk
factors and other important factors affecting forward-looking
statements, please see Avangrid’s Annual Reports on Form 10-K and
Quarterly Reports on Form 10-Q filings and the information filed on
Avangrid’s Forms 8-K with the SEC as well as its subsequent SEC
filings, and the risks and uncertainties related to the proposed
transaction with Iberdrola, including, but not limited to: the
expected timing and likelihood of completion of the proposed
transaction, including the timing, receipt and terms and conditions
of any required shareholder, governmental and regulatory approvals
of the proposed transaction that could reduce the anticipated
benefits of, or cause the parties to abandon, the transaction,
risks that an event, change or other circumstance could give rise
to the termination of the merger agreement, risks that competing
offers or acquisition proposals for Avangrid could be made, risks
related to disruption of management time from ongoing business
operations due to the proposed transaction, the risk that the
proposed transaction and its announcement could have an adverse
effect on the ability of Avangrid to retain and hire key personnel
and maintain relationships with its customers and suppliers, and on
its operating results and businesses generally, and litigation or
administrative proceedings that may arise in connection with the
proposed transaction. Other unpredictable or unknown factors not
discussed in this communication could also have material adverse
effects on forward-looking statements. Should one or more of these
risks or uncertainties materialize, or should any of the underlying
assumptions prove incorrect, actual results may vary in material
respects from those expressed or implied by these forward-looking
statements. You should not place undue reliance on these
forward-looking statements. Avangrid does not undertake any
obligation to update or revise any forward-looking statements to
reflect events or circumstances after the date of this report,
whether as a result of new information, future events or otherwise,
except as may be required under applicable securities laws. Other
risk factors are detailed from time to time in Avangrid’s reports
filed with the SEC and we encourage you to consult such
disclosures.
1 Permission to use quotes neither sought nor obtained.
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version on businesswire.com: https://www.businesswire.com/news/home/20240916055993/en/
Analysts: Charlotte Ancel, Charlotte.Ancel@Avangrid.com,
203-997-7366 Media: Leo Rosales, Leo.Rosales@Avangrid.com,
518-419-2401
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