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v3.25.2

Merger | 6 Months Ended
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Jun. 30, 2025
Business Combination [Abstract] |
Merger | Merger On May 18, 2025, TXNM, Parent, and Merger Sub, entered into the Merger Agreement, pursuant to which Merger Sub will merge with and into TXNM, with TXNM surviving the Merger as a direct wholly-owned subsidiary of Parent. Parent and Merger Sub are affiliates of Blackstone Infrastructure. Pursuant to the Merger Agreement, each issued and outstanding share of the common stock of TXNM (other than (i) the issued shares of TXNM common stock that are owned by TXNM, Parent, Merger Sub, or any other wholly-owned subsidiaries of Parent or TXNM, in each case, not held on behalf of third parties, which will be automatically cancelled at the Effective Time and (ii) shares of TXNM common stock outstanding immediately prior to the Effective Time and held by a holder who has not voted in favor of, or consented in writing to, the Merger who is entitled to, and who has demanded, payment for fair value of such shares in accordance with applicable New Mexico law) will, at the Effective Time, be converted into the right to receive $61.25 in cash, without interest. The proposed Merger has been unanimously approved by the Board. Consummation of the Merger is subject to the satisfaction or waiver of certain customary conditions, including, without limitation, the approval by at least a majority of the holders of outstanding shares of TXNM common stock entitled to vote thereon, the absence of any material adverse effect on TXNM, no legal prohibition on the consummation of the Merger (a “Legal Restraint”), and the receipt of certain required regulatory approvals (including PUCT, NMPRC, FERC, NRC and under the Hart-Scott-Rodino Antitrust Improvements Act of 1976). The Merger Agreement does not contain any financing condition. The Merger is currently expected to close in the second half of 2026. The Merger Agreement provides that under limited specified circumstances, the Board may change its recommendation in respect of the Merger prior to the receipt of shareholder approval if it determines that an alternative acquisition proposal constitutes a Superior Proposal (as defined in the Merger Agreement) or if an event or circumstance (other than an acquisition proposal or an action taken pursuant to regulatory approval covenants) that is material, first becomes known to the Board after the execution of the Merger Agreement and affects or would reasonably be expected to affect the business of TXNM and its subsidiaries, taken as a whole, or the shareholders of TXNM (including the benefits of the Merger to the shareholders of TXNM), in which case Parent will have the right to terminate the Merger Agreement and receive the TXNM Termination Fee (as defined below). The Merger Agreement may be terminated by each of TXNM and Parent under certain circumstances, including if the Merger is not consummated by the 15-month anniversary of the execution of the Merger Agreement (as extended, the “End Date”), so long as failure of the Merger to consummate on or before the End Date was not due to the breach of the Merger Agreement by such party, subject to an automatic extension of the End Date until December 31, 2026 and an additional three-month extension by mutual agreement of the parties, in each case if all of the conditions to the closing, other than the conditions related to obtaining regulatory approvals or the absence of a Legal Restraint, have been satisfied or waived. The Merger Agreement also provides for other customary termination rights for both Parent (including if the Board changes its recommendation in respect of the Merger) and TXNM. The Merger Agreement further provides that, upon termination of the Merger Agreement under certain specified circumstances (including if Parent terminates the Merger Agreement due to a change in recommendation of the Board or if TXNM terminates the Merger Agreement to accept a Superior Proposal), TXNM will be required to pay Parent a termination fee of $210.0 million plus costs and expenses (“TXNM Termination Fee”). In addition, the Merger Agreement provides that (i) if the Merger Agreement is terminated by either party as a result of a Legal Restraint (solely in connection with required regulatory approvals), (ii) if the Merger Agreement is terminated by either party as a result of the Merger not being consummated by the End Date, (iii) the Merger Agreement is terminated by TXNM as a result of a terminable breach by Parent, (iv) Parent fails to effect the closing when all closing conditions have been satisfied and it is otherwise obligated to do so under the Merger Agreement or (v) TXNM terminates the June 2025 Purchase Agreement (as defined below) as a result of Purchaser (as defined below) failing to timely consummate the Stock Purchase Closing (as defined below), then, in any such case, upon termination of the Merger Agreement, Parent will be required to pay TXNM a termination fee of $350.0 million plus costs and expenses as the sole and exclusive remedy (the “Parent Termination Fee”). Parent and Merger Sub have obtained equity and debt financing commitments for the transactions contemplated by the Merger Agreement. Pursuant to an equity commitment letter dated May 18, 2025 (the “Equity Commitment Letter”), Blackstone Infrastructure committed to provide Parent, at the consummation of the Merger, with an equity contribution in the amount set forth therein. In addition, pursuant to debt commitment letters (“Debt Commitment Letters”) delivered to Merger Sub, Royal Bank of Canada, MUFG Bank, Ltd., BNP Paribas, Sumitomo Mitsui Banking Corporation and Canadian Imperial Bank of Commerce have agreed to provide debt financing to Merger Sub following the Closing on the terms and subject to the conditions set forth therein. The equity financing, when funded in accordance with the Equity Commitment Letter together with the debt financing when funded in accordance with the Debt Commitment Letters, will provide an amount that is sufficient to fund the payment of (i) the aggregate per share merger consideration, (ii) the repayment of certain TXNM debt to be satisfied at Closing and (iii) all related fees, costs and expenses. Additionally, following Closing, Parent and TXNM will have sufficient funds to repay, prepay or discharge certain other debt obligations of TXNM. In addition, Blackstone Infrastructure has entered into a limited guarantee with TXNM (the “Limited Guarantee”), pursuant to which Blackstone Infrastructure has guaranteed the obligations of Parent and Merger Sub to pay the Parent Termination Fee and certain costs and expenses reimbursement obligations of TXNM under the Merger Agreement. The Limited Guarantee is capped at $375.0 million. Upon consummation of the Merger, the outstanding shares of TXNM common stock will be delisted from the New York Stock Exchange (“NYSE”) and deregistered under the Exchange Act.

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