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CDPQ, Generation Investment join forces on private equity investments

Caisse de depot et placement du Quebec, Quebec City, and Generation Investment Management are teaming up to invest an initial $3 billion in private equity opportunities.

The C$308.3 billion ($238.8 billion) CDPQ and Generation, which has $20 billion in assets under management, said in a joint news release that the partnership will make investments with an eight- to 15-year duration, which better suits the objectives of sustainable value creation for building long-term businesses.

The partnership will target businesses with "outstanding management teams and solid long-term growth prospects," the news release said. Investments will be net positive for the environment, will benefit society and, in many cases, use technology as a key factor for driving change.

"This partnership is a natural match between two like-minded organizations," Michael Sabia, CEO of CDPQ, which manages Quebec public pension plan and other provincial assets, said in the release. "Sustainability begins with long-term involvement, which is why we made long-term investment the cornerstone of CDPQ-Generation. We both integrate ESG principles at the core of our investment strategies and believe they go hand-in-hand with attractive returns. We also have tremendous complementarity, as we bring together Generation's world-class equity research team with CDPQ's investment expertise and global network."

A spokeswoman for CDPQ could not be reached for comment.

The partnership also announced its first investment, acquiring a majority stake in financial technology firm FNZ. The deal is subject to regulatory approval. The partnership is acquiring the stake from General Atlantic and H.I.G. Capital; FNZ partners with banks, insurers and money managers to help consumers better achieve their financial goals, said a separate news release by CDPQ and Generation. FNZ has more than 330 billion ($430 billion) in assets under administration.