Iberdrola is moving to acquire the 18.4% stake in Avangrid that it does not already own.

The Spanish-based multinational utility operator said May 17 that this is a growth strategy: It wants to expand its presence in markets with strong credit ratings and its exposure to regulated businesses such as networks.

The $2.55 billion deal is subject to approval by shareholders, FERC and utility regulators in Maine and New York. Upon completion, which is anticipated in the fourth quarter, Iberdrola will seek to delist Avangrid shares from the New York Stock Exchange.

Avangrid is headquartered in Orange, Conn. It has approximately $45 billion in assets and 8,000 employees, mainly in renewables and networks. Its operations include eight electric and natural gas utilities in New York and New England serving more than 3.3 million customers.

Iberdrola is based in Bilbao, Spain, and is the largest European electrical utility by market capitalization. Its assets on five continents are valued at more than 150 billion euros; its 2023 installed capacity was 62,883 MW; its power lines stretch 1.28 million km; and it employs more than 42,000 people.

Both companies claim leadership roles in the clean energy transition.

Avangrid has 8.7 GW of renewable capacity installed in 24 states and is a 50/50 partner in the first large-scale U.S. offshore wind farm, Vineyard Wind 1, now under construction. Iberdrola is pursuing a renewable portfolio totaling 100 GW.

The acquisition works out to $35.75/share, an increase from the original offer of $34.25. That represents an 11.4% premium over the closing price of Avangrid stock on March 6, the last unaffected trading day before Avangrid announced it had received Iberdrola’s unsolicited offer.

Avangrid said its board of directors unanimously approved the agreement.