The Canada Pension Plan Investment Board has agreed to acquire a 50% ownership interest in Peruvian power-generation company Inkia Energy at a total enterprise value of US$3.4 billion.

CPPIB will invest alongside I Squared Capital, which will acquire the remaining 50% stake through an I Squared-led continuation vehicle. The transaction is subject to closing conditions and government approvals.

Inkia operates a diversified 2.6-gigawatt generation portfolio through its subsidiaries, Kallpa Generación S.A. and Orazul Energy Peru S.A.. The company supports Peru’s energy demand, driven in part by the country’s mining sector, and has a development pipeline exceeding 4GW of wind, solar, gas and battery storage projects.

“Inkia operates a highly resilient power-generation platform that aligns well with our long-term approach to investing in high-quality businesses that can deliver attractive risk-adjusted returns for the CPP Fund,” said Bill Rogers, managing director and head of Sustainable Energies for CPPIB. “The transaction reflects CPPIB’s continued focus on long-duration power-generation assets with strong governance and sustainability practices, alongside our experienced partner I Squared.”

I Squared has been invested in Inkia since 2017, overseeing the company’s expansion of its core Peruvian generation business from 1.6GW to 2.6GW and the divestiture of non-core assets across 10 Latin American jurisdictions. The firm will continue to play an active role in Inkia’s governance and strategic direction, according to I Squared and CPPIB..

“Inkia is a developer at its core and represents exactly the kind of essential infrastructure platform we seek to build and grow over the long term,” said Gautam Bhandari, a global chief investment officer and a managing partner at I Squared. “This partnership with CPPIB reflects our shared conviction in the long-term fundamentals of Peru’s power market and Inkia’s ability to play a leading role in meeting the country’s evolving energy needs. Together, we see significant opportunity to continue investing in the platform and supporting Peru’s energy transition.”

CPPIB has been investing in Latin America since 2006 across asset classes including public equities, private equities, real estate, infrastructure and fixed income.

I Squared Capital is a global infrastructure investor managing more than US$50 billion in assets. Founded in 2012 and headquartered in Miami, the firm invests in mid-market infrastructure across power and utilities, transportation and logistics, digital infrastructure, environmental infrastructure and social infrastructure, with a portfolio of more than 100 companies operating in over 70 countries.

Photo: Inkia