CDPQ acquires 25% stake in UK hydropower operator from Brookfield

September 24, 2024 (Preqin News) - Caisse de dépôt et placement du Québec (CDPQ), a Canadian public pension fund which manages CAD 452bn ($335.6bn), has acquired a 25% stake in a UK hydropower company from Brookfield Asset Management.

First Hydro, which provides 76% of the UK's pumped hydro storage capacity, runs two plants in the Snowdonia region of Wales, with a capacity of more than 2,000 MW. French utility company Engie remains the majority shareholder with a 75% stake in the company.

‘First Hydro is playing a critical role in helping the United Kingdom manage its national electricity system and meet its net zero commitment by providing renewable electricity and storage capabilities,’ said Emmanuel Jaclot, CDPQ's Executive Vice-President and Head of Infrastructure.

CDPQ is no stranger to the UK infrastructure landscape. The public pension fund acquired a 25% stake in offshore green energy provider London Array Wind Farm in 2013, a CAD 259mn holding in South East Water in 2010, and a 25% equity interest in Interconnector, a gas transporter, in 2007, according to Preqin data

As institutional investors globally have increased allocations to infrastructure, the ‘Maple 8’, the eight largest public pension funds in Canada, spearheaded direct investment in infrastructure assets in the early 2000s, in what came to be known as the ‘Canadian Model’.

Around one in ten infrastructure deals from 2019 onwards are through direct investments – with Canadian public pension funds accounting for around 16% of direct deals from 2019 to 2024.

LP directs – a steady source of deals

Infrastructure deals and LP direct infrastructure investments, 2019 – 2024 YTD

_{Source: Preqin Pro. Data as of September 2024}

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