The New Mexico Public Regulation Commission’s staff on Monday determined that the state’s largest electric provider and the private equity firm seeking to acquire it violated state law in 2025 by conducting a $400 million stock sale tied to the takeover without first obtaining PRC approval.

Hearing examiners late Monday morning issued a recommended decision, which requires PRC approval, to reverse the stock sale and mandate PNM and Blackstone Infrastructure produce a written report explaining how they reversed the deal and how they will make sure ratepayers are not adversely affected. They also recommended maximum penalties against both companies.

The transaction has been the subject of several complaints as PNM and Blackstone work toward an $11.5 billion acquisition.