WSIB turns $500m Geronimo commitment into partnership with National Grid

New arrangement will provide US pension and UK utility with the right of first offer on renewables projects Geronimo develops.

The Washington State Investment Board has restructured $500 million originally committed to the Geronimo Renewable Infrastructure Partners fund into a co-investment partnership with the UK’s National Grid.

According to a document published on WSIB’s website published online, the US pension announced the allocation shift this week. It comes after the UK utility bought out the fund’s manager, Geronimo Energy, last month.

WSIB, which manages $128.1 billion on behalf of state retirement and public funds, also announced $2.1 billion in new private equity commitments. According to the document, the board approved the commitments at a meeting on 18 April.

National Grid announced in a statement that it had acquired Geronimo Energy, a Minneapolis-based renewables developer, on 7 March for $100 million. It said that further payments were possible “subject to successful development” of Geronimo Energy’s project pipeline. The developer manages more than 2.2GW of North American wind and solar projects that are either operating or under construction.

According to National Grid’s statement, as part of the deal the utility is also paying $125 million to acquire a 51 percent stake in 378MW of solar and wind assets developed by Geronimo, which it will jointly own with WSIB. WSIB called its new relationship with National Grid a “partnership” which has the right of first offer on future projects Geronimo develops.

National Grid’s statement added that the acquisition of Geronimo and its purchase of the renewables assets were expected to close during the second quarter of 2019.W

WSIB first committed $300 million from its tangible assets portfolio to Geronimo Renewable Infrastructure Partners in 2017, shortly after the developer had begun raising a $1 billion fund. According to the investor’s disclosure documents, Dorota Czub, a WSIB investment officer, said at the time that Geronimo’s fund offered “long-term asset hold” and the possibility of a “permanent structure” to manage investments.

In February, WSIB made a $200 million follow-on commitment to Geronimo’s fund. The tangible assets portfolio accounted for 4.8 percent of WSIB’s total managed assets as of 31 December 2018.

WSIB, National Grid and Geronimo did not respond to requests for comment.