After pulling my hair for several days, I found this:

https://bugs.launchpad.net/ubuntu/+source/network-manager/+bug/1638842

/usr/lib/NetworkManager/conf.d/10-globally-managed-devices.conf has the
following content:

[keyfile]
unmanaged-devices=*,except:type:wifi,except:type:wwan

Removing the file and restarting NetworkManager did the trick.

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https://bugs.launchpad.net/bugs/1658921

Title:
  NetworkManager does not manage wired connection

Status in network-manager package in Ubuntu:
  Confirmed

Bug description:
  NetworkManager does not manage my wired eth0 connection, no matter how
  I set /etc/network/interfaces or
  /etc/NetworkManager/NetworkManager.conf

  Using ubuntu 16.04, /etc/network/interfaces only managed lo, and
  [ifupdown] section of NetworkManager.conf had set managed=false.

  With these same settings, after upgrading to ubuntu 16.10, eth0
  appears as unmanaged in nm-applet.

  If I modify /etc/network/interfaces and add

  auto eth0
  iface eth0 inet dhcp

  And set managed=true in NetworkManager.conf [ifupdown] section, eth0
  is still unmanaged despite it does get an IP from DHCP server.

  This is happening in my five computers (two laptops and three
  desktops).

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