CPPIB and Votorantim JV Invest in Brazilian Power

Canada Pension Plan Investment Board (CPPIB), a professional investment management organization, and Votorantim Energia, the energy subsidiary of Brazil’s Votorantim Group, announced that they have signed agreements to form a new joint venture focusing on investments and developments in the Brazilian power generation sector.

The joint venture is initially acquiring two operational wind parks in Northeastern Brazil: Ventos do Araripe III from Brazilian project developer Casa dos Ventos, and Ventos do Piauí I, contributed by Votorantim Energia into the joint venture. 

As part of the transaction, CPPIB is initially contributing approximately BRL690 million (US$206 million) in equity. Over time, the joint venture expects to invest more than BRL3 billion in operational and development assets in this sector in Brazil.

Ventos do Piauí I is located in the state of Piauí, and has a generating capacity of approximately 206 megawatts of power with committed investments of BRL1.2 billion. Ventos III, located in the state of Piauí and Pernambuco, has an installed capacity of approximately 359 megawatts with committed investments of BRL1.8 billion. Together, the wind parks will have 565 megawatts of installed capacity, with almost all of their entire production contracted in the regulated market. The acquisitions are subject to customary closing conditions and regulatory approvals.

Bruce Hogg, Managing Director, Head of Power and Renewables, CPPIB, commented:

“This transaction enables CPPIB to establish a footprint in the attractive Brazilian power generation market, which fits well with our overall power and renewables strategy and further diversifies the CPP Fund.”

“Brazil is considered among the top renewable energy markets in the world, and as demand in the country grows, wind energy is expected to be one of the largest contributors to this new supply. We look forward to building a long-term partnership with Votorantim, a best-in-class local operator, to expand our joint venture. As power demand grows worldwide and with a focus on accelerating the energy transition, CPPIB will continue to seek opportunities to expand our power and renewables portfolio globally.”

João Miranda, CEO of Votorantim, added:

“We are very enthusiastic to partner with CPPIB, a reputable investor that shares our long-term vision for the sector and the prospects for the joint venture. This reinforces our commitment to the power sector in Brazil, where we have been investors for almost 100 years,”

Fabio Zanfelice, president of Votorantim Energia, said:

“The renewable energy sector is an attractive, expanding market that will require major investments from the private sector now and in the coming decades. By joining with a strong partner such as CPPIB, we have expanded our capacity and accelerated our growth plan in this segment with an investor that shares our vision for the business.”