CDPQ supports KKR's acquisition and the energy transition plan of French-based Albioma SA

Rhea-AI Summary

CDPQ has provided EUR 485 million (approximately CAD 650 million) in acquisition financing to support KKR's friendly offer to acquire 100% of Albioma SA, a French renewable energy producer. This marks CDPQ's inaugural transaction under its $10-billion transition envelope aimed at decarbonizing high-emission sectors. Albioma operates over 1 GW of renewable capacity and is committed to ending coal use by 2025, with a goal of generating 100% of its electricity from renewable sources by 2030. The investment supports sustainable energy transition efforts.

Positive

• CDPQ's investment aligns with a $10-billion transition envelope aimed at decarbonizing heavy-emitting sectors.
• Albioma has a clear plan to convert thermal plants to biomass, supporting its goal of 100% renewable electricity by 2030.
• The acquisition strengthens KKR's commitment to accelerating the energy transition.

Negative

• None.

• Inaugural transaction for CDPQ's $10-billion transition envelope dedicated to the decarbonization of the heaviest-emitting sectors

MONTRÉAL, Nov. 4, 2022 /PRNewswire/ -Global investment group CDPQ announced today that it has provided part of the EUR 485 million (approximately CAD 650 million) acquisition financing to support the friendly tender offer launched by KKR & Co. (NYSE: KKR), a leading global investment firm, to acquire 100% of Albioma SA, a French independent renewable energy producer. CDPQ is the main lender in the transaction, alongside other commercial lenders and banks.

Albioma SA operates over 1 GW of installed capacity around the world, through thermal, solar and geothermal power assets, mainly in French metropolitan and overseas territories. As part of its strategy to support the energy transition, the company aims to end coal use by 2025 by pursuing the conversion of its coal fired power plants into primarily residual biomass power plants and generate 100% of its electricity from renewable energy by 2030.

"Albioma SA provides essential infrastructure that delivers renewable energy in French overseas territories and the company has taken deliberate action to convert its operational thermal plants away from coal. With this investment, we take a step forward in tackling the complex challenge of decarbonizing heavy-emitting sectors while supporting a longstanding partner, KKR, expand their commitment to accelerating the energy transition," said Marc Cormier, Executive Vice-President and Head of Fixed Income at CDPQ.

"This first transaction as part of our transition envelope represents how long-term capital can support the path towards a more sustainable economy. This investment demonstrates CDPQ's climate strategy at work across multiple investment approaches to decarbonize the real economy and accelerate the energy transition," said Marc-André Blanchard, Executive Vice-President and Head of CDPQ Global and Global Head of Sustainability.

In order to meet CDPQ's transition envelope criteria, a clear and robust decarbonization plan aligned with the Paris Agreement goals was required and reviewed by an independent expert. Albioma's conversion plan to convert its thermal plants towards 100% biomass fuel sources is underway, demonstrating the company's commitment to the energy transition.

ABOUT CDPQ
At CDPQ, we invest constructively to generate sustainable returns over the long term. As a global investment group managing funds for public pension and insurance plans, we work alongside our partners to build enterprises that drive performance and progress. We are active in the major financial markets, private equity, infrastructure, real estate and private debt. As at June 30, 2022, CDPQ's net assets totalled CAD 391.6 billion. For more information, visit cdpq.com, follow us on Twitter or consult our Facebook or LinkedIn pages.

CDPQ is a registered trademark owned by Caisse de dépôt et placement du Québec and licensed for use by its subsidiaries.

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SOURCE CDPQ

FAQ

What is the purpose of KKR's acquisition of Albioma?

KKR aims to acquire Albioma to enhance its portfolio in the renewable energy sector and support the transition to sustainable energy.

What financing did CDPQ provide for KKR's acquisition of Albioma?

CDPQ provided EUR 485 million (approximately CAD 650 million) in acquisition financing for the deal.

What are Albioma's goals regarding renewable energy?

Albioma plans to end coal use by 2025 and generate 100% of its electricity from renewable sources by 2030.

How does this acquisition impact KKR's strategy?

The acquisition supports KKR's strategy to invest in renewable energy and contribute to global decarbonization efforts.

When was the acquisition financing announced?

The acquisition financing was announced on November 4, 2022.