Spanish energy giant Iberdrola has completed the divestiture of 55% of its operations to the Mexican Government for $6.2bn (€5.71bn).

The divestment includes 13 power generation plants with a combined installed capacity of 8.5GW.

It predominantly includes gas-fired combined cycle power stations, constituting 99% of the plants sold.

Of the plants, 87% operate under an independent power producer regime, with contracts established with the Comisión Federal de Electricidad (CFE).

The plants operating under the independent power producer regime contracted to the CFE are: Altamira III and IV with 1.1GW; Altamira V with 1.15GW; Baja California with 324MW; Escobedo with 878MW; La Laguna with 537MW; the La Venta III wind farm with 103MW; Monterrey I and II with a joint capacity of 449MW; Tamazunchale I with 1.18GW; Topolobampo II with 917MW; and Topolobampo III with 766MW of capacity.

The sale also encompasses the privately operated combined cycle gas plants Monterrey III and IV with 477MW, Tamazunchale II with 514MW and Enertek with 144MW of capacity.

The 460 workers currently employed by these facilities will transfer to the trust managed by Mexico Infrastructure Partners.

Iberdrola will maintain ownership of 15 plants, all of its private customers and its portfolio of renewable energy projects and pipelines.

The Spanish company plans to expand its wind and solar assets in Mexico.

The National Infrastructure Fund of Mexico, other public financial entities associated with the Mexican Government and private finance groups provided financial backing for the operation.

Iberdrola has entered power purchase agreements with the MIP-led trust, along with a contract for the provision of transitional services for the temporary management of the divested assets.

Iberdrola executive chairman Ignacio Galán and Mexican President Andrés Manuel López Obrador signed the initial memorandum of understanding in April 2023.

In February 2024. the Government of Mexico obtained regulatory approval to acquire the 13 power plants from Iberdrola for $6bn (102.34bn pesos).

The country’s antitrust regulator, the Federal Economic Competition Commission, approved the deal on condition that the energy assets are operated independently.

The strategic acquisition will increase Mexico’s influence over the power sector and increase state control of electricity generation to 60%.