- Positions ALLETE to Execute Clean-Energy Future for Customers,
Communities and Employees as a Private Company
- ALLETE to Remain Locally Managed and Operated with Headquarters
in Duluth, Minnesota
- Agreement Contains Meaningful Commitments to Retain ALLETE’s
Workforce and Maintain Compensation Levels and Benefits
Programs
- Utilities Minnesota Power and Superior Water, Light and Power
to Continue Being Regulated by Minnesota Public Utilities
Commission (MPUC) and Public Service Commission of Wisconsin
(PSCW)
- Union Agreements to be Honored
- Shareholders to Receive $67.00 Per Share in Cash
ALLETE, Inc. (NYSE: ALE) and a partnership led by Canada Pension
Plan Investment Board (“CPP Investments”) and Global Infrastructure
Partners (“GIP”), (the “partnership”), today jointly announced that
they have entered into a definitive agreement under which the
partnership will acquire ALLETE for $67.00 per share in cash, or
$6.2 billion including the assumption of debt.
ALLETE is a leading energy company and provider of safe,
reliable, and competitively priced energy with a national
footprint. Together, ALLETE and its family of companies, which
includes regulated utilities and renewable energy companies, are
focused on driving the clean-energy transition by expanding
renewables, reducing carbon, enhancing grid resiliency, and driving
innovation.
“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,” said ALLETE
Chair, President, and Chief Executive Officer Bethany Owen. “CPP
Investments and GIP have a successful track record of long-term
partnerships with infrastructure businesses, and they recognize the
important role our ALLETE companies serve in our communities as
well as our nation’s energy future. Together, we will continue to
invest in the clean-energy transition and build on our 100
plus-year history of providing safe, reliable, affordable energy to
our customers."
CPP Investments and GIP are premier, well-resourced
infrastructure investors at a global scale with deep industry
expertise and long-term outlooks. Together, they bring over four
decades of experience investing in large-scale infrastructure
businesses across sectors to support sustainable, long-term growth.
Both CPP Investments and GIP pride themselves on their responsible
investment approach, which is centered on delivering value to their
organizations and the communities in which they operate.
Owen continued, “Our ‘Sustainability-in-Action' strategy will
require focused execution and significant capital. Transitioning to
a private company with these strong partners will not only limit
our exposure to volatile financial markets, it also will ensure
ALLETE has access to the significant capital needed for our planned
investments now and over the long term. Importantly, CPP
Investments and GIP are aligned with ALLETE’s values of safety,
integrity, planet and people. They also recognize the importance of
our employees and our ties to the communities we serve and in which
we operate. To that end, we are proud to remain locally managed as
we enter this next chapter as committed as ever to our customers,
our communities and our employees. I look forward to all we will
achieve together.”
“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,” said James Bryce, Managing Director and Global
Head of Infrastructure, CPP Investments. “ALLETE is at the
forefront of the clean energy transition and we are thrilled to
support the delivery of the company’s ‘Sustainability-in-Action’
strategy, which we believe will generate substantial value both for
ALLETE’s customers and CPP contributors and beneficiaries.”
“We are excited to work with Bethany Owen and the full ALLETE
team as they continue to supply affordable and reliable energy
services,” said Bayo Ogunlesi, GIP’s Chairman and Chief Executive
Officer. “GIP, alongside CPP Investments, look forward to
partnering to provide ALLETE with additional capital so they can
continue to decarbonize their business to benefit the customers and
communities they serve. Bringing together ALLETE, with its
demonstrated commitment to clean energy, with GIP, one of the
world’s premier developers of renewable power, furthers our
commitment to serve growing market needs for affordable,
carbon-free and more secure sources of energy.”
Commitment to Employees, Customers and Communities
Under the terms of the merger agreement governing the proposed
transaction, several commitments have been made by CPP Investments
and GIP to align with ALLETE’s shared purpose, culture and values,
including:
- Retaining Workforce: The agreement provides commitments
with respect to workforce retention, as well as maintaining
compensation levels and benefits programs. The agreement also
honors union contracts including our strong partnership with the
International Brotherhood of Electrical Workers.
- Maintaining Current Headquarters and Leadership:
ALLETE’s Minnesota Power and Superior Water, Light and Power
(SWL&P) will continue as independently operated, locally
managed, regulated utilities. Bethany Owen will continue as Chief
Executive Officer, and the current management team will continue to
lead ALLETE and remain as the primary points of contact for
customers, regulators and other stakeholders. ALLETE will continue
to be headquartered in Duluth, Minnesota.
- Contributing to Community: ALLETE and its family of
businesses and the Minnesota Power Foundation will continue to make
economic and charitable contributions in its service territories to
support vibrant and sustainable communities, close opportunity
gaps, and help people of all ages live with purpose and passion.
ALLETE will continue to invest corporate resources and employee
volunteer hours to help build thriving communities.
In addition, the transaction will support existing commitments
made by ALLETE such as:
- ALLETE’s Clean-Energy Goals: All ALLETE companies will
remain committed to advancing a clean-energy future, through solar,
wind, storage and transmission infrastructure and achieving
carbon-free goals of the respective states in which the companies
operate.
- Retail or Municipal Rates for Utility Customers:
Following the close of the acquisition, Minnesota Power and
SWL&P will continue to be regulated by the Minnesota Public
Utilities Commission (MPUC), the Public Service Commission of
Wisconsin (PSCW) and the Federal Energy Regulatory Commission
(FERC). The acquisition is not expected to impact retail or
municipal rates for utility customers.
Terms, Approvals and Timing
In connection with the merger, CPP Investments and GIP will
acquire all of the outstanding common shares of ALLETE for $67.00
per share in cash representing an enterprise value of approximately
$6.2 billion, including ALLETE’s net debt. This represents a
premium of approximately 19.1% to ALLETE’s closing share price on
December 4, 2023, the date prior to a media article reporting that
ALLETE was exploring a sale. The consideration also represents a
22.1% premium to the 30-day volume weighted average share price
prior to that date.
The acquisition was unanimously approved by ALLETE’s Board of
Directors and is expected to close in mid-2025, subject to the
approval of ALLETE’s shareholders, the receipt of regulatory
approvals, including by the MPUC, PSCW and FERC, and other
customary closing conditions. Dividends payable to ALLETE
shareholders are expected to continue in the ordinary course until
the closing, subject to approval by ALLETE’s Board of Directors.
Upon completion of the acquisition, ALLETE’s shares will no longer
trade on the New York Stock Exchange, and ALLETE will become a
private company.
Advisors
J.P. Morgan Securities LLC is acting as lead financial advisor
and provided a fairness opinion to ALLETE, and Houlihan Lokey
Capital, Inc. also provided a fairness opinion to ALLETE. Skadden,
Arps, Slate, Meagher & Flom LLP is acting as legal advisor to
ALLETE.
Cancellation of First Quarter 2024 Earnings Conference
Call
ALLETE will release its financial results for the first quarter
as scheduled before the stock markets open on Thursday, May 9,
2024. In light of the announced transaction with CPP Investments
and GIP, ALLETE will be cancelling its scheduled earnings
conference call.
Additional Resources
Additional information and stakeholder resources are also
available on ALLETE’s dedicated transaction website at
www.ALLETEforward.com.
About ALLETE, Inc.
ALLETE, Inc. is an energy company headquartered in Duluth,
Minnesota. ALLETE’s largest business unit, Minnesota Power, is an
electric utility which serves 150,000 residents, 14 municipalities,
and some of the nation’s largest industrial customers. In addition
to Minnesota Power, ALLETE owns Superior Water, Light and Power,
based in Superior, Wisconsin, ALLETE Clean Energy, based in Duluth;
BNI Energy in Bismarck, N.D.; and New Energy Equity, headquartered
in Annapolis, Maryland; and has an 8% equity interest in the
American Transmission Co. More information about ALLETE is
available at www.allete.com. ALE-CORP
ALLETE calculates and reports carbon emissions based on the GHG
Protocol. Details in ALLETE’s Corporate Sustainability Report.
About CPP Investments
Canada Pension Plan Investment Board (CPP Investments™) is a
professional investment management organization that manages the
Fund in the best interest of the more than 22 million contributors
and beneficiaries of the Canada Pension Plan. In order to build
diversified portfolios of assets, investments are made around the
world in public equities, private equities, real estate,
infrastructure and fixed income. Headquartered in Toronto, with
offices in Hong Kong, London, Luxembourg, Mumbai, New York City,
San Francisco, São Paulo and Sydney, CPP Investments is governed
and managed independently of the Canada Pension Plan and at arm’s
length from governments. At December 31, 2023, the Fund totaled
C$590.8 billion. For more information, please visit
www.cppinvestments.com or follow us on LinkedIn, Instagram or on X
@CPPInvestments.
About Global Infrastructure Partners (GIP)
Global Infrastructure Partners (GIP) is a leading infrastructure
investor that specializes in investing in, owning and operating
some of the largest and most complex assets across the energy,
transport, digital infrastructure and water and waste management
sectors. With decarbonization central to our investment thesis, we
are well positioned to support the global energy transition.
Headquartered in New York, GIP has offices in Brisbane, Dallas,
Hong Kong, London, Melbourne, Mumbai, Singapore, Stamford and
Sydney.
GIP has approximately $112 billion in assets under management.
Our portfolio companies have combined annual revenues of
approximately $73 billion and employ over 115,000 people. We
believe that our focus on real infrastructure assets, combined with
our deep proprietary origination network and comprehensive
operational expertise, enables us to be responsible stewards of our
investors' capital and to create positive economic impact for
communities. For more information, visit www.global-infra.com.
Important Information and Where to Find It
This communication may be deemed to be solicitation material in
respect of the proposed transaction. In connection with the
proposed transaction, ALLETE, Inc. (“ALLETE”) expects to file a
proxy statement on Schedule 14A with the Securities and Exchange
Commission (“SEC”). ALLETE also may file other documents with the
SEC regarding the merger. INVESTORS AND SECURITY HOLDERS ARE URGED
TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS THAT
ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS
OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY
BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT
THE PROPOSED TRANSACTION AND RELATED MATTERS. Investors are or will
be able to obtain such documents (if and when available) free of
charge at http://www.sec.gov, the SEC’s website, or from ALLETE’s
website (http://www.investor.allete.com).
Participants in the Solicitation
ALLETE and its directors, executive officers, other members of
management, and employees may be deemed to be participants in the
solicitation of proxies in respect of the proposed merger.
Information regarding ALLETE’s directors and executive officers is
contained in (i) the “Directors, Executive Officers and Corporate
Governance,” “Executive Compensation” and “Security Ownership of
Certain Beneficial Owners and Management and Related Stockholder
Matters” sections of the Annual Report on Form 10-K for the fiscal
year ended December 31, 2023 of ALLETE, which was filed with the
SEC on February 20, 2024 and (ii) the “Item No. 1 – Election of
Directors,” “Compensation Discussion and Analysis,” and “Ownership
of ALLETE Common Stock” sections in the definitive proxy statement
for the 2024 annual meeting of shareholders of ALLETE, which was
filed with the SEC on March 28, 2024. To the extent the holdings of
ALLETE’s securities by ALLETE’s directors and executive officers
have changed since the amounts set forth in the proxy statement for
its 2024 annual meeting of shareholders, such changes have been or
will be reflected on Statements of Changes in Beneficial Ownership
on Form 4 filed with the SEC. More detailed information regarding
the identity of potential participants, and their direct or
indirect interests, by securities, holdings or otherwise, will be
set forth in the proxy statement and other materials relating to
the merger when they are filed with the SEC. You may obtain free
copies of these documents using the sources indicated above.
Cautionary Statement Regarding Forward-Looking
Information
This communication contains “forward-looking statements” within
the meaning of the federal securities laws, including safe harbor
provisions of the Private Securities Litigation Reform Act of 1995,
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, including
statements regarding the proposed acquisition of ALLETE,
shareholder and regulatory approvals, the expected timetable for
completing the proposed transaction and any other statements
regarding ALLETE’s future expectations, beliefs, plans, objectives,
financial conditions, assumptions or future events or performance
that are not historical facts. This information may involve risks
and uncertainties that could cause actual results to differ
materially from such forward-looking statements. These risks and
uncertainties include, but are not limited to: failure to obtain
the required vote of ALLETE’s shareholders; the timing to
consummate the proposed transaction; the risk that the conditions
to closing of the proposed transaction may not be satisfied; the
risk that a regulatory approval that may be required for the
proposed transaction is not obtained or is obtained subject to
conditions that are not anticipated; and the diversion of
management’s time on transaction-related issues.
When used in this communication, or any other documents, words
such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,”
“target,” “could,” “goal,” “intend,” “objective,” “plan,”
“project,” “seek,” “strategy,” “target,” “may,” “will” and similar
expressions are intended to identify forward-looking statements.
These forward-looking statements are based on the beliefs and
assumptions of management at the time that these statements were
prepared and are inherently uncertain. Such forward-looking
statements are subject to risks and uncertainties that could cause
actual results to differ materially from those expressed or implied
in the forward-looking statements. These risks and uncertainties,
as well as other risks and uncertainties that could cause ALLETE’s
actual results to differ materially from those expressed in the
forward-looking statements, are described in greater detail under
the heading “Item 1A. Risk Factors” in ALLETE’s Form 10-K for the
year ended December 31, 2023 and in subsequently filed Forms 10-Q
and 8-K, and in any other SEC filings made by ALLETE. These risks
should not be considered a complete statement of all potential
risks and uncertainty, and will be discussed more fully, along with
other risks associated with the proposed transaction, in the proxy
statement to be filed with the SEC in connection with the proposed
transaction. Management cautions against putting undue reliance on
forward-looking statements or projecting any future results based
on such statements or present or prior earnings levels. Forward-
looking statements speak only as of the date hereof, and ALLETE
does not undertake any obligation to update or supplement any
forward-looking statements to reflect actual results, new
information, future events, changes in its expectations or other
circumstances that exist after the date as of which the
forward-looking statements were made, except as required by
applicable law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240506154719/en/
Investor Contact: Vince Meyer Director - Investor
Relations & Treasury 218-723-3952 vmeyer@allete.com Media
Contact: Amy Rutledge Director - Corporate Communications
218-723-7400 arutledge@allete.com CPP Investments Contact:
Asher Levine Managing Director, Corporate Communications
alevine@cppib.com Global Infrastructure Partners (GIP)
Contact: Mustafa Riffat Managing Director & Global Head of
Communications mustafa.riffat@global-infra.com
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