Pension Pulse

Josh Saul and Emma Sanchez of Bloomberg report that KKR and PSP to buy AEP Transmission stake for $2.8 billion (all figures in US dollars): American Electric Power Co. agreed to sell a minority stake in its transmission business to KKR & Co. and Canada’s PSP Investments for $2.8 billion.  The investment firms will acquire a roughly 20% interest in AEP’s Ohio, Indiana and Michigan transmission companies, the companies said in a statement Thursday. KKR and PSP, which formed a 50-50 partnership for the acquisition, are investing in transmission as electricity use in the US is expected to surge, thanks to data centers and artificial intelligence.  “Areas such as Ohio and Indiana are experiencing growth that has not been seen for decades,” AEP Chief Executive Officer Bill Fehrman said in the company’s own statement. AEP’s transmission system has 40,000 miles (64,000 kilometers) of wires and is the largest in the US, according to its website.  AEP will use the pr...

Freschia Gonzalez of Wealth Professional reports that CPP Investments to exit Calpine stake, expects US$2.6bn in proceeds: CPP Investments has announced the sale of its entire 15.75 percent stake in US power producer Calpine Corporation (Calpine) to Constellation Energy (Constellation). The sale forms part of Constellation's acquisition of Calpine. The transaction is expected to generate approximately US$700m in cash and US$1.9bn in Constellation stock for CPP Investments. The investment in Calpine was made in 2018 through a co-investment with Energy Capital Partners (ECP) and Access Industries. Bill Rogers, managing director and head of Sustainable Energies at CPP Investments, expressed satisfaction with the outcome, stating, “We are pleased by the success of our investment in Calpine and view this transaction as an ...

Bert Clark, President and CEO of Investment Management Corporation of Ontario, wrote a comment for the Financial Post over the holidays stating the S&P 500’s performance in 2024 made investing look easy, so why bother with strategy: The S&P 500 has been on something of a tear. Total returns so far this year (as of Dec. 23), have been 26 per cent. That’s on top of total returns of 26 per cent in 2023. This is the kind of investment performance that can make some investors wonder whether Warren Buffet was right when he suggested that, for most people, the best thing to do is own the S&P 500 index. Whether this is the right investment strategy for an investor is something they would need to decide. This is in no way meant to challenge Buffet’s investment perspective. Or, for that matter, to suggest an alternative strategy for individual investors. But recency bias can be powerful. So, with the S&P 500 up as much as it has been over the past few years, it is a good...

ReNew Canada reports Hydro One to acquire 48% interest in the East-West Tie Line project: Hydro One announced that its wholly-owned subsidiary, Hydro One Networks Inc., has entered into an agreement to purchase an approximately 48 per cent interest in the East-West Tie Limited Partnership from affiliates of OMERS Infrastructure Management Inc. (OMERS) and Enbridge Transmission Holdings Inc. (Enbridge). The East-West Tie Limited Partnership owns the East-West Tie Line, a 450-kilometre, 230 kV double-circuit transmission line, regulated by the Ontario Energy Board (OEB), spanning from Wawa to Thunder Bay, along the north shore of Lake Superior. Hydro One has agreed to purchase its interest in the partnership for $257 million in cash, subject to customary adjustments. The transaction results in a partnership with the remaining owners of the East-West Tie Line – the Bamkushwada Limited Partnership, a consortium of six First Nations, and affiliates of NextEra Energy C...