Canadian pension funds, Ontario Teachers' Pension Plan (OTPP) and Public Sector Pension (PSP), have engaged Bank of America and Canadian Imperial Bank of Commerce (CIBC) to assist in the divestment process of their jointly owned London-based renewables venture, Cubico Sustainable Investments, as reported by Spanish business daily Expansion on Tuesday, citing multiple market sources.
Expansion indicates that the banks have been tasked with evaluating potential divestment strategies for Cubico, as both pension funds express the desire to exit the venture. Cubico, valued at approximately EUR 5 billion (USD 5.48 billion), poses a challenge for potential buyers due to its extensive size, technologically diverse portfolio, and global presence, making a unified sale of the entire company complex.
Cubico Sustainable Investments operates in ten countries, including the UK, Spain, Italy, Greece, Brazil, Mexico, Uruguay, the United States, Colombia, and Australia. The company's portfolio encompasses 3 GW of installed capacity, with 652 MW under construction and an additional 4.8 GW in the development pipeline, covering onshore wind, solar photovoltaic, concentrated solar power (CSP) plants, as well as transmission and distribution lines.
Expansion speculates that the sale of CSP plants within Cubico's portfolio might pose a greater challenge due to the perceived lack of investor interest in this specific technology.
Established in 2015, Cubico was originally a partnership between OTPP, PSP, and Spanish bank Banco Santander SA. Banco Santander contributed assets valued at over USD 2 billion to the venture but exited a year later, leaving the Canadian pension funds to manage the business jointly on a 50/50 basis.
The involvement of Bank of America and CIBC is seen as a strategic move to navigate the complexities of divesting Cubico Sustainable Investments and maximize returns for both OTPP and PSP.