U.S. utility Allete is going private in a $6.2 billion deal after agreeing to be acquired by a partnership led by Canada Pension Plan Investment Board and Global Infrastructure Partners (GIP).

The Minnesota-based clean energy company said on May 6 it entered a definitive agreement to be acquired for $67 per share in cash. The purchase price, which includes debt, represents a premium of about 19.1% to Allete’s closing share price on Dec. 4, 2023, the day before news broke about the company exploring a sale.

Allete’s shares will no longer trade on the New York Stock Exchange, Allete said in a news release.

The transaction, which was unanimously approved by Allete’s board of directors, is expected to close in mid-2025, subject to approval of its shareholders along with required regulatory approvals and other customary closing conditions.

“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 CEO 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.”

The electric utility is the parent company of Minnesota Power, which the company said serves about 145,000 residents, 15 municipalities and large industrial customers. Its assets also include Allete Renewable Resources, which operates wind generation facilities in North Dakota, and New Energy Equity, a leading developer of distributed solar energy projects.

“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,” said James Bryce, managing director and global head of infrastructure for CPP Investments.

As part of the agreement, Owen will continue to serve as CEO along with the current management team, according to the release. In addition, Allete’s Minnesota Power and Superior Water, Light and Power (SWL&P) will continue as independently operated, locally managed, regulated utilities. The company’s headquarters will remain in Duluth, Minnesota.

The partnership led by CPP Investments and GIP was represented by Latham & Watkins LLP. Leading the Latham team were New York partners David Allinson and David Beller and New York counsel Richard Quay, with associates Saïd Bakir and Eric Czubiak.

J.P. Morgan Securities LLC is acting as lead financial adviser 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 adviser to Allete.