PSP, OTPP snap up Santander’s stake in Cubico

The Spanish bank's exit from the renewables platform it helped create last year was 'always part of the plan', according to PSP's private investment chief.

Two of Canada's largest pension managers have bought out Banco Santander's stake in renewable energy joint venture Cubico Sustainable Investments.

The deal means Public Sector Pension Investment Board and Ontario Teachers' Pension Plan now have a 50 percent stake in Cubico's 1.62GW portfolio of wind, solar and water assets each. Cubico's management team, including chief executive Marcos Sebares, will remain in place, the pensions said in a statement.

Guthrie Stewart, senior vice-president and global head of private investments at PSP Investments, told Infrastructure Investor this move was part of a “natural evolution” for Cubico. It was always part of the plan for Santander to exit the company it helped create in May of 2015 with 18 of its own assets, he said.

The two pensions, which together manage over $280 billion in assets, “share aligned interests” that will enable Cubico's long-term growth, Stewart said. The company was an example of PSP Investments' efforts at forming industry-specific platforms and developing “strong partnerships with like-minded investors,” he explained.

“Cubico's flexible investment and acquisition approach fits well with Ontario Teachers' approach to private investments,” Andrew Claerhout, OTPP's senior vice-president for infrastructure, said in a statement.

The company invests on a deal-by-deal basis through equity injections from its shareholders.

Cubico is headquartered in London and has regional offices in Milan, Mexico City and Sao Paulo. The Sao Paulo branched opened at the beginning of this year after it purchased two wind farms in Brazil for 2 billion real ($502 million; €462 million). Last month, Cubico agreed to purchase 10 operating UK solar farms generating a combined 65MW.

It has assets in operation or under construction in Brazil, Italy, Ireland, Mexico, Portugal, Spain, the UK and Paraguay. Cubico, which has given a big share of its attention so far to South America, has also said it is looking for opportunities in India and Eastern Europe.