Allete, Inc. has just received unanimous approval from the Minnesota Public Utilities Commission for its acquisition by Canada Pension Plan Investment Board (CPP Investments) and Global Infrastructure Partners (GIP). This acquisition is expected to close in late 2025, following the issuance of the MPUC's written order.
The approval has resulted in approximately $200 million in total Minnesota Power customer benefits through this process. The final agreement, supported by various organizations and advocates, includes several commitments that will impact customer affordability and rates, clean energy and infrastructure, as well as local oversight and control.
In terms of customer affordability and rates, the agreement includes a one-year base rate freeze for Minnesota Power customers, $50 million in additional rate credits, and a $10 million long-term residential energy bill mitigation fund. Additionally, the return on equity (ROE) will be reduced from 9.78% to 9.65% post-close, immediately lowering costs for customers, with a future ROE cap of 9.78% through December 31, 2030. There will also be up to $3.5 million in residential customer arrearage forgiveness, supporting eligible low-income customers.
On the clean energy and infrastructure front, the agreement guarantees access to capital to fund Allete's five-year plan for advancing transmission and renewable energy goals. Furthermore, a $50 million clean firm technology fund will support regional clean-energy projects and partnerships.
The transaction has also received approvals from Allete shareholders and federal and state agencies, including the Federal Energy Regulatory Commission and the Public Service Commission of Wisconsin.
Upon closing of the transaction, Allete's shares will no longer trade on the New York Stock Exchange. However, Minnesota Power and Superior Water, Light and Power will remain public utilities, fully regulated by the Minnesota Public Utilities Commission and the Public Service Commission of Wisconsin, respectively.
The acquisition is expected to position Allete to meet the significant infrastructure demands of the clean-energy transition without compromising the high-quality service and commitments to reliability and affordability.
For more information about Allete and this partnership, visit alleteforward.com. Following these announcements, the company's shares moved 0.73%, and are now trading at a price of $67.21. Check out the company's full 8-K submission here.
