Attorney General Tong, Consumer Counsel Petition for State Review of Iberdrola Move to Take Avangrid Fully Private

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09/16/2024

Attorney General Tong, Consumer Counsel Petition for State Review of Iberdrola Move to Take Avangrid Fully Private

(Hartford, CT) - Attorney General William Tong and Consumer Counsel Claire E. Coleman today filed a petition with the Public Utilities Regulatory Authority seeking state review of the proposed acquisition by Iberdrola of all remaining shares of Avangrid. Iberdrola is a Spain-based multinational conglomerate that owns 81.6 percent of United Illuminating, Southern Gas and Connecticut Natural Gas, as well as utilities in Maine, Massachusetts and New York. Iberdrola has moved to purchase all remaining shares, removing Avangrid as a publicly traded company.

Once fully private, Avangrid will no longer have an obligation to make filings with the U.S. Securities Exchange Commission, will no longer have minority shareholders that could serve as a check on risky corporate behavior, and will no longer be subject to a 2015 shareholder agreement established when Avangrid acquired United Illuminating, Southern Gas and Connecticut Natural Gas. That agreement required the company to appoint four independent directors to its board, including two from the formerly independent Connecticut utilities. Further, the acquisition requires Iberdrola to pay $300 million in premiums to minority shareholders, diverting resources away from investments that could better benefit Connecticut consumers.

Iberdrola has applied for regulatory approval with the SEC, the Federal Energy Regulatory Commission, the state public utilities regulatory commissions in New York and Maine, but it has not applied for such approval in Connecticut or Massachusetts.

Iberdrola has already failed to honor its obligations to Connecticut consumers. Earlier this year, Attorney General Tong sued United Illuminating over the company's longstanding failure to remediate contamination at the defunct English Station power plant in New Haven. Last month, the company refused to comply with a PURA order to provide credits to customers installing home electric vehicle charging stations.

"Connecticut families are hurting right now under surging, unaffordable electric costs. We need more accountability and oversight, not less when it comes to our public utilities. Avangrid may have a Connecticut address, but we know far too many major decisions are made in Spain. This expensive maneuver diverts hundreds of millions of dollars away from Connecticut needs, and extinguishes some of the last vestiges of local control. This deal needs rigorous state scrutiny," said Attorney General Tong.

"Avangrid's footprint in Connecticut spans both the natural gas and electric utility sectors, serving hundreds of thousands of customers across the state - and those customers could be impacted by Iberdrola's plan to reduce oversight of Avangrid's activities," said Consumer Counsel Coleman. "Iberdrola's move to take Avangrid private should be reviewed in a proceeding before Connecticut's Public Utilities Regulatory Authority. Similar reviews are underway in both Maine and New York, and Connecticut's consumers deserve the same level of protection from any potential harm. I am grateful for Attorney General Tong's partnership in today's joint petition on behalf of Connecticut's consumers."

Assistant Attorney General John Wright, Legal Assistant Caroline McCormack, and Deputy Associate Attorney General Michael Wertheimer, Chief of the Consumer Protection Section are assisting the Attorney General in this matter.

Twitter: @AGWilliamTongFacebook: CT Attorney General

Media Contact:

Elizabeth Benton
[email protected]

Consumer Inquiries:

860-808-5318
[email protected]

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