NM PRC ruling raises doubts about Blackstone’s PNM utility takeover

New Mexico PRC ruling raises new doubts about Blackstone’s PNM takeover

Commission finds Blackstone and TXNM violated state law, orders companies to unwind illegal stock transaction

SANTA FE, N.M. — The Private Equity Stakeholder Project (PESP) today applauds the New Mexico Public Regulation Commission’s (PRC) decision finding that Blackstone and TXNM Energy violated state law by completing a $400 million stock transaction without prior approval and ordering the companies to unwind the transaction.

The PRC found that Blackstone’s $400 million stock transaction violated New Mexico law, declared the transaction “void and of no effect,” ordered the companies to unwind it, and held that the violation is relevant to whether Blackstone’s proposed takeover of PNM is consistent with the public interest.

“This decision reinforces what many New Mexicans have been concerned about from the beginning: Blackstone’s proposed takeover raises serious questions about whether a Wall Street private equity firm is the right steward for an essential public utility,” said Nichole Heil, Senior Research Coordinator at the Private Equity Stakeholder Project. “The Commission found that Blackstone violated state law by completing this transaction without the required approval. That finding should weigh heavily as regulators continue to consider whether Blackstone should be entrusted with ownership of New Mexico’s largest electric utility. The PRC’s responsibility is to protect New Mexicans, not Blackstone’s investment strategy.”

PESP has previously warned that private-equity-style return expectations can create pressure for higher utility rates while shifting focus away from the long-term interests of customers and communities. Blackstone has pointed to its investment in Northern Indiana Public Service Company (NIPSCO) as evidence of its utility expertise, yet NIPSCO has faced significant scrutiny over affordability concerns, some of the highest utility bills in Indiana, and a month-long lockout involving approximately 1,600 union workers. PESP has also documented Blackstone’s broader labor record, which earned the firm an F grade in the organization’s Private Equity Labor Scorecard, as well as concerns surrounding Blackstone’s growing utility and data center investments.

The Commission’s decision follows another major utility proceeding in which regulators raised concerns about private equity ownership. During review of BlackRock’s proposed acquisition of Minnesota Power, an administrative law judge warned that private-equity-style return expectations could create pressure for higher utility rates. Together, these proceedings underscore growing questions about whether private equity ownership is compatible with the public-interest obligations of regulated utilities.

PESP urges the New Mexico PRC to reject Blackstone’s proposed acquisition of TXNM and ensure New Mexico’s electric utility remains focused on serving ratepayers, workers, and communities rather than Wall Street investors.