New Mexico DOJ Seeks Review of TXNM Energy Stock Sale in Merger Case

The New Mexico Department of Justice (NMDOJ) has taken formal steps to address a stock transaction linked to TXNM Energy's proposed merger with a Blackstone affiliate. The move highlights regulatory oversight requirements for public utility transactions in the state.

On February 19, 2026, the NMDOJ filed a notice of joinder and a supporting brief with the New Mexico Public Regulation Commission (PRC). The filing called for TXNM Energy, Troy ParentCo LLC, and related parties to justify a stock sale that occurred in connection with their planned merger.

The NMDOJ's submission stated that the issuance of 8 million TXNM Energy shares to a Blackstone affiliate for $400 million, executed alongside the merger agreement, may not comply with Section 62-6-12 of the Public Utilities Act. This section requires PRC approval for such transactions involving public utility stock.

Attorney General Raúl Torrez said in a statement that state law mandates oversight when public utility stock is issued as part of a transaction of this nature. He added that the acquisition must be conducted in accordance with all legal requirements.

What the numbers show

• 8 million TXNM Energy shares were sold to a Blackstone affiliate
• The transaction was valued at $400 million
• Blackstone affiliate received 7.59% of TXNM's outstanding shares
• Merger agreement set per-share consideration at $61.25 in cash
• TXNM Energy committed $105 million in New Mexico rate credits

On February 20, 2026, Attorney General Torrez reiterated his position, stating that the $400 million stock sale to the Blackstone affiliate in 2025 may have breached state law requiring PRC approval. He supported a motion from the nonprofit Prosperity Works, which argued that the transaction should be considered void and could have substantial consequences.

Prosperity Works, based in Albuquerque, filed its motion on February 6, 2026. The organization contended that the stock sale, which gave the Blackstone affiliate 7.59% ownership in TXNM, violated New Mexico law and requested that the PRC require TXNM and Blackstone to explain why the transaction should be allowed.

TXNM Energy, Troy ParentCo LLC, and Troy Merger Sub Inc. entered into a merger agreement on May 18, 2025. Under this agreement, TXNM would merge into a Blackstone affiliate and become a wholly owned subsidiary, with shareholders receiving $61.25 per share in cash.

TXNM Energy submitted applications for regulatory approval of the acquisition to the NMPRC, the Public Utility Commission of Texas (PUCT), and the Federal Energy Regulatory Commission (FERC) on August 25, 2025. These filings included commitments for $105 million in rate credits and other benefits for New Mexico communities.

Industry reaction

The Public Utility Commission of Texas approved a settlement for Blackstone Infrastructure’s acquisition of TXNM Energy on February 6, 2026. However, the merger still requires a decision from the New Mexico Public Regulation Commission before it can proceed.

According to filings, the NMDOJ and Prosperity Works have both called for further scrutiny of the stock transaction and have requested that the PRC ensure compliance with state law before any merger is finalized.

* This article is based on publicly available information at the time of writing.