Mexico’s main antitrust agency, the Federal Economic Competition Commission, approved with conditions the acquisition of 13 electric power generation plants of Iberdrola by the National Infrastructure Fund, a trust of the Mexican government created for investments in infrastructure.

On February 13, 2024, the Board of Commissioners of the Federal Economic Competition Commission (“COFECE”) authorized with conditions the acquisition by the National Infrastructure Fund (“FONADIN”), a governmental trust for investments in infrastructure, of 13 electric power generation plants owned by Iberdrola Generación México, S.A. de C.V. and its subsidiaries (“Iberdrola”).

The Mexican government, which also owns and controls the Comisión Federal de Electricidad (CFE), and Iberdrola are the main market participants in electric power generation activities in the country. COFECE conditioned the transaction to ensure that it will not generate anticompetitive effects in the markets.

To that effect, COFECE determined that buyers shall operate the power generation plants independently, without any influence of or communication with any competitor. Therefore, buyers shall comply with the following conditions:

Within two years, FONADIN and its affiliates shall reduce and maintain its investment up to a maximum of 51.

• An independent professional manager shall be appointed, who shall be responsible of the operation of the plants.
• The management decisions of the plants shall be undertaken through supra majority vote or with the intervention of the institutional investors or independent members.
• The individuals responsible of the operation of the plants shall be independent and have no conflicts.
• In addition, buyers are required not to exchange information that may facilitate anticompetitive conduct, for which they shall comply with the following conditions:
• To appoint an independent officer to ensure compliance with the foregoing.
• The officers and personnel responsible of operating the plants shall not hold any position with any other competitor and they may not have been public servants for the past 4 years.

Buyers shall unconditionally accept the conditions established by COFECE to close the transaction.

According to the press release issued by COFECE, once accepted, buyers must comply with these conditions for 10 years.

COFECE shall publish a public version of its decision authorizing this transaction within 20 days after its notification to the parties to the transaction. 

If additional information is required on the foregoing or any related matters, do not hesitate to contact our antitrust and energy teams at Dentons López Velarde.

Any interested party may access COFECE’s press release here.