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Borealis Buys Stake in Four US Wind Farms from Spain’s EDP Renováveis

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According to the press release, “EDP Renováveis S.A. (“EDPR”) has reached an agreement to sell 49% of the Class A shares in a portfolio of wind farm assets located in the United States to Borealis Infrastructure for US$230 million. The portfolio is comprised of four wind farms totaling 599 MW, all of which were installed between 2007 and 2008 and have long-term Power Purchase Agreements (PPAs) in place. EDPR will continue to own the remaining 51% of the Class A shares in the portfolio.

Borealis Infrastructure invests in and manages infrastructure investments on behalf of the Ontario Municipal Employees Retirement System (“OMERS”), one of Canada’s largest pension funds. Its large-scale assets in the energy sector include the recent acquisition of Michigan-based Midland Cogeneration Venture (“MCV”), the largest natural gas fired, combined cycle cogeneration plant in the United States.

“Our investment in this portfolio marks a significant commitment by Borealis to the renewables sector, and is the type of large-scale infrastructure asset we look for to generate stable and consistent returns for the pension plan. We look forward to working with the proven management team at EDPR, and see this transaction as the beginning of a long-term partnership,” said Michael Rolland, President and CEO of Borealis.

EDPR is the world’s third largest wind energy company. Through this transaction, EDPR is commencing the execution of its asset rotation strategy, which it announced as one of its core objectives earlier this year. This strategy involves selling minority stakes in mature projects that are operationally optimised and with a low risk profile. This will enable EDPR to crystallise the value of its projects’ future cash-flow streams and re-invest in the development of quality and value-accretive projects, while contributing to its self-funding growth objective.

“We are pleased to have gained a partner such as Borealis,” said Joao Manso Neto, EDPR Chief Executive Officer. “This partnership is a step toward securing a positive future for both EDPR and Borealis. We look forward to the continuation of this relationship as EDPR continues to grow.”

Barclays acted as financial advisor for Borealis, and Shearman & Sterling acted as legal advisor.

The transaction is subject to the customary regulatory approvals by the Federal Energy Regulatory Commission (“FERC”) and the Committee on Foreign Investment in the United States (“CFIUS”).”

Read more: OMERS Press Release

Funds and Ownership, KKR Partners with Shinhan Financial

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South Korean financial giant Shinhan Financial Group Co., Ltd. reached a preliminary agreement with KKR & Co. to form a series of global buyout funds that could raise up to 5 trillion KRW. KKR and Shinhan signed a Memorandum of Understanding (MoU) in Seoul in early October. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Norwegian Government Recommends SWF Remains at Central Bank

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There was speculation that Norway Government Pension Fund Global (GPFG) could be managed outside of Norges Bank. The Norwegian government shot down this idea and recommended Norway’s GPFG remain in Norges Bank. This recommendation came in the form of a white paper submitted to the Norwegian Parliament, Stortinget.

Norway’s Minister of Finance Siv Jensen, commented in a press release, “The Government proposes a new and modernised governance structure for Norges Bank. Moving forward, this new structure lays the foundations for the sound management of the central bank and of the GPFG.”

Some Central Bank Recommendations

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Invesco Buys OppenheimerFunds for $5.7 Billion

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Invesco Ltd. signed a deal to acquire OppenheimerFunds, Inc. from Massachusetts Mutual Life Insurance Company (MassMutual). In turn, MassMutual and the OppenheimerFunds employee shareholders will receive a combination of common and preferred equity consideration, and MassMutual will become a significant shareholder in Invesco, with an approximate 15.5% stake. This strategic transaction will bring Invesco’s total assets under management (AUM) to more than US$ 1.2 trillion. The transaction is expected to close in the second quarter of 2019, pending necessary regulatory and other third-party approvals. The transaction gives Invesco access to more third-party distribution platforms.[ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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