Based in the US, Allete owns Minnesota Power, Superior Water, Light and Power, Allete Clean Energy, BNI Energy and New Energy Equity and the energy company also has an 8% equity interest in American Transmission


Allete to be acquired by a partnership led by CPP Investments and GIP in a deal worth nearly $6.2bn. (Credit: Andrew Martin from Pixabay)

US-based energy company Allete has agreed to be acquired by a partnership led by Canada Pension Plan Investment (CPP Investments) and Global Infrastructure Partners (GIP) in a deal that represents an enterprise value of nearly $6.2bn.

Under the terms of the definitive agreement, shareholders of the publicly listed Allete will receive $67 per share in cash.

The consideration represents a 19.1% premium to Allete’s closing share price as well as a premium of 22.1% to the 30-day volume weighted average share price on 4 December 2023.

CPP Investments managing director and infrastructure global head James Bryce said: “Allete’s management team has done an excellent job leading the company toward a truly sustainable clean-energy future.

“Together with GIP, we look forward to bringing our sector expertise and long-term capital to support Allete’s strong management team as they continue to deliver safe, reliable, affordable energy services to their customers.”

Headquartered in Minnesota, Allete offers safe, reliable, and competitively priced energy across the US.

The firm’s largest business unit, Minnesota Power, is said to serve 150,000 residents, 14 municipalities, and some of the country’s largest industrial customers.

Allete also owns Superior Water, Light and Power, Allete Clean Energy, BNI Energy and New Energy Equity. Besides, the energy company has an 8% equity interest in American Transmission.

Allete chair, president and CEO Bethany Owen said: “Our ‘Sustainability-in-Action’ strategy has secured Allete’s place as a clean-energy leader.

“Through this transaction with CPP Investments and GIP, we will have access to the capital we need while keeping our customers, communities and co-workers at the forefront of all that we do, with continuity of our day-to-day operations, strategy and shared purpose and values.”

Following the completion of the acquisition, the American energy company’s shares will no longer be traded on the New York Stock Exchange and it will become a private company.

Through the proposed deal, Allete aims to implement clean-energy future for customers, communities and employees as a private company. The company is also expected to remain locally managed.

Besides, the definitive agreement between the parties will maintain Allete’s workforce as well as compensation levels and benefits programmes.

Furthermore, post-transaction Minnesota Power and Superior Water, Light and Power will remain as independently operated, locally managed, regulated utilities.

Both will be regulated by the Minnesota Public Utilities Commission (MPUC), the Public Service Commission of Wisconsin (PSCW) and the Federal Energy Regulatory Commission (FERC).

Subject to the approval of Allete’s shareholders, the receipt of regulatory approvals and other customary conditions, the deal is anticipated to be completed in mid-2025.