The Canadian Press reports CPP Investments earned 7.8% for fiscal 2026, net assets total $793.3 billion: 

The Canada Pension Plan Investment Board has reported a return of 7.8 per cent for its 2026 fiscal year.

The results helped increase its net assets to $793.3 billion at March 31, up from $714.4 billion at the end of its 2025 fiscal year.

It says the increase for the year included $56.9 billion in net income and $22.0 billion in net transfers from the Canada Pension Plan.CPP Investments chief executive John Graham says the results reflected the strength of its diversified portfolio and the reach of its global investment platform.

The returns were helped by its holdings in public equities, while its real assets, particularly energy and infrastructure assets, also contributed to the gains.

The results for the year by CPP Investments fell short of its benchmark portfolio which returned 13.2 per cent for the same period, as it was boosted by relatively heavier exposure to the large technology companies that outpaced the broader market for the year.

Layan Odeh of Bloomberg also reports that stocks, data centers drive the Canada Pension Fund to 7.8% return:

Canada Pension Plan Investment Board notched a 7.8% return in its most recent fiscal year, as gains on stocks and data center investments helped offset the impact of a softening US dollar and a weak year in private equity.

The returns, which pushed net assets to C$793.3 billion ($576.2 billion), came in a period “marked by geopolitical uncertainty, market volatility and currency movements,” Chief Executive Officer John Graham said in a statement. 

Public equities gained 17.5% and were a key driver of results, particularly in the US, led by information technology and communication services. But private equity rose just 2.9%, partly because of the poor performance of some holdings in the software business, which investors see as vulnerable to AI-related disruption. 

Real assets delivered a 12.2% return, boosted by data center investments and industrial real estate in the Asia-Pacific region, the fund said. 

CPPIB’s results were hurt by the decline of the greenback against the Canadian dollar and by losses on government bonds, as expectations for central bank rate cuts shifted. The weakening of the US dollar contributed to a foreign currency loss of C$12.4 billion.

During the fiscal year ended March 31, Canada’s largest pension plan shifted some real estate, infrastructure and energy investments that were previously reported as equities to the real assets group, “to better reflect the underlying characteristics of these assets,” according to the annual report. Private equity now makes up 22% of the total fund, down from 25% a year earlier. 

The pension plan made billions in new data center-related investments or commitments, including a C$225 million loan for a hyperscale expansion of a data center in Cambridge, Ontario.

CPPIB also committed $1.5 billion to an account managed by Blackstone Inc. that invests globally across diversified credit, including fund commitments, spanning private corporate credit, asset-based and real estate credit, structured products and liquid credit.

Layan Odeh also reports that CPP investments' boss warns about AI-fueled valuations as stocks keep rising:

Canada Pension Plan Investment Board’s top executive said the firm is getting increasingly uncomfortable with rich valuations in a stock market that’s dominated by technology and artificial intelligence companies.

“We have a market that is rewarding concentration. We have a market that is being driven by a handful of companies,” said John Graham, chief executive officer of the C$793 billion ($576 billion) fund.

The six largest technology companies in the S&P 500 now represent more than a third of that benchmark, led by Nvidia Corp., which is worth $5.3 trillion. They’ve been on a tear lately, helping lift the US stock gauge 14% since the end of March — and it has nearly doubled since the beginning of 2023.

The sustained rally has left far fewer opportunities, Graham said in an interview after the pension fund revealed its results for the fiscal year that ended in March. “I wouldn’t say we’re a deep-value investor, but we certainly have a value bias,” he said. “We certainly like to invest in cash flows, and we struggle with some of the valuations in the market today.”

Canada’s largest pension manager posted a 7.8% return in the 2025-26 fiscal year, driven by double-digit gains in public equities. Like some other members of the so-called Maple Eight group of Canadian pension funds, CPPIB’s stock portfolio is outpacing private equity returns by a wide margin.

But parts of CPPIB’s equities team had a difficult year. The fund’s active equities strategies incurred a C$3.5 billion net loss, bringing the five-year loss to C$6 billion. Regulatory changes in China weighed on the overall performance over the five-year period, prompting the fund to to reduce its exposure in that country.

The firm’s active equities team, which invests in public and soon-to-be-public companies, shrank to 120 employees from 139 people two years ago.

“We think it’s an important part of the broader portfolio to have a fundamental equities capability,” Graham said. “The big question is, how big do you think it should be?”

The rise of passive investing has reshaped markets in recent years, with investors directing more capital toward lower-cost strategies.

Some Canadian pension funds are now revisiting how much stock-picking they do. British Columbia Investment Management Corp. is closing two active equities strategies that oversee about C$4.3 billion, saying they’re no longer useful in a shrinking global pool of publicly listed firms. Last year, Ontario Teachers’ Pension Plan said it was altering its approach by prioritizing passive investing over stock picking.

Canada’s largest pension plan shifted some real estate, infrastructure and energy investments that were previously reported as equities to the real assets group, “to better reflect the underlying characteristics of these assets,” according to the annual report. Private equity makes up 22% of the total fund, down from 25% a year earlier.

CPPIB will continue to emphasize diversification across hedge funds, private equity, infrastructure, stocks, credit and real estate, Graham said. The credit team was “quite opportunistic” during the year, he said, helping credit investments gain 3.8%. The fund’s overall returns were hurt by the weakening of the US dollar, which represented the majority of its currency exposure, according to the annual report.

On investing in Canada, Graham said CPPIB has staffed each investment department for a while with teams dedicated to the domestic market, to “have Canada as part of their remit and their mandate,” the CEO said.

CPPIB also disclosed that Graham was paid C$7 million in the fiscal year, up from C$6.4 million a year earlier.

Earlier today, CPP Investments announced net assets total $793.3 billion at 2026 fiscal year end: 

Highlights:

• Net income of $56.9 billion
• Net annual return of 7.8% in fiscal 2026
• 10-year annualized net return of 8.8%

TORONTO, ON (May 21, 2026): Canada Pension Plan Investment Board (CPP Investments) ended its fiscal year on March 31, 2026, with net assets of $793.3 billion, compared to $714.4 billion at the end of fiscal 2025. The $78.9 billion increase in net assets consisted of $56.9 billion in net income and $22.0 billion in net transfers from the Canada Pension Plan (CPP).

The Fund, composed of the base CPP and additional CPP accounts1, generated a 10-year annualized net return of 8.8%. For the fiscal year, the Fund’s net return was 7.8%. As the CPP is designed to serve multiple generations of beneficiaries, evaluating the performance of CPP Investments over extended periods is more suitable than in single years.

“Fiscal 2026 was a strong year for CPP Investments. In a period marked by geopolitical uncertainty, market volatility and currency movements, we delivered a 7.8% net return and the Fund grew to more than $790 billion,” said John Graham, President & CEO. “These results reflect the strength of our diversified portfolio and the reach of our global investment platform. By staying disciplined and investing for the long term, we continued to build value for generations of CPP contributors and beneficiaries.”

A diverse range of asset classes contributed to the strength of the fiscal year’s performance at CPP Investments. Public equities were a key driver of results, particularly in the U.S., led by information technology and communication services in the first half of the year. Real assets, particularly energy and infrastructure assets, also contributed meaningfully, alongside steady gains in credit. These gains were partially offset by foreign exchange movements, driven by the depreciation of the U.S. dollar against major currencies including the Canadian dollar, and by losses in government bonds as market expectations for major central bank interest policies shifted. Conflict in the Middle East at the end of the fiscal year contributed to a broad selloff in global equity markets, against a backdrop of ongoing geopolitical uncertainty and global inflation.

On a 2025 calendar-year basis, the Fund delivered a 7.7% net return, primarily driven by public equities, with gains across all asset classes.

“What matters most for a pension fund serving generations of Canadians is long-term performance, and over the past decade our investment programs have contributed positively to the Fund’s returns,” said Graham. “Through disciplined decision-making and global diversification, we have earned $549 billion in cumulative net income since we started investing more than 25 years ago, helping us protect and grow the Fund while building resilience through changing market conditions.”

Performance of the Base and Additional CPP Accounts

The base CPP account ended the fiscal year on March 31, 2026, with net assets of $712.9 billion, compared to $655.8 billion at the end of fiscal 2025. The $57.1 billion increase in net assets consisted of $53.2 billion in net income and $3.9 billion in net transfers from the base CPP. The base CPP account’s net return for the fiscal year was 8.0% and the 10-year annualized net return was 8.8%.

The additional CPP account ended the fiscal year on March 31, 2026, with net assets of $80.4 billion, compared to $58.6 billion at the end of fiscal 2025. The $21.8 billion increase in net assets consisted of $3.7 billion in net income and $18.1 billion in net transfers from the additional CPP. The additional CPP account’s net return for the fiscal year was 5.4% and the annualized net return since inception was 6.0%.

The additional CPP was designed with a different legislative funding profile and contribution rate compared to the base CPP. Given the differences in its design, the additional CPP has had a different market risk target and investment profile since its inception in 2019. As a result of these differences, we expect the performance of the additional CPP to generally differ from that of the base CPP.

Furthermore, due to the differences in its net contribution profile, the additional CPP account’s assets are also expected to grow at a much faster rate than those in the base CPP account.

Long-Term Financial Sustainability

Every three years, the Office of the Chief Actuary of Canada (OCA), an independent federal body that provides checks and balances on the future costs of the CPP, evaluates the financial sustainability of the CPP over a long period. In the most recent triennial review published in December 2025, the Chief Actuary reaffirmed that, as at December 31, 2024, both the base and additional CPP continue to be sustainable over the long term at the legislated contribution rates.

The Chief Actuary’s projections are based on the assumption that, over the 75-year projection period following December 31, 2024, the base CPP account will earn an average annual rate of return of 4.05% above the rate of Canadian consumer price inflation. The corresponding assumption is that the additional CPP account will earn an average annual real rate of return2 of 3.53%.

CPP Investments continues to build a portfolio designed to achieve a maximum rate of return without undue risk of loss, while considering the factors that may affect the funding of the CPP and its ability to meet its financial obligations on any given day. The CPP is designed to serve contributors and beneficiaries today and across future generations. Accordingly, long-term results are a more appropriate measure of CPP Investments’ performance and impact on plan sustainability.

“Canadians can continue to rely on the CPP as a strong foundation for their retirement income,” said Graham. “The Chief Actuary’s latest report shows our approach is on track, with investment income coming in approximately $80 billion higher than expected over the three-year period since December 31, 2021. This performance has strengthened the CPP’s funding outlook and helped create the conditions for governments to agree to a reduction in the contribution rate, while maintaining benefit levels and supporting a strong, sustainable plan for current contributors and future retirees alike. As a pension fund investor whose role is to prudently grow the Fund so Canadians can rely on the CPP for generations, it is especially meaningful that we have been able to contribute to this outcome.”

The OCA report provides forward-looking return assumptions and projected financial states for the base and additional CPP. The table below presents CPP Investments’ historical net real returns, which reflect realized performance over past periods.

Relative Performance

CPP Investments was created to invest and help grow the Fund, with the legislative mandate to maximize returns without undue risk of loss. The organization’s overall investment strategy is therefore focused on delivering a level of absolute performance that will help ensure the CPP meets all current and future obligations to contributors and beneficiaries.

CPP Investments also tracks investment performance relative to benchmarks to report on the value active management adds after all costs over different time horizons. It does so against the benchmark portfolios, which provide target allocations for our active and balancing investment strategies. We construct the benchmark portfolios by aggregating the sector- and geography-relevant public market index benchmarks to assess relative performance of each individual investment strategy. CPP Investments’ performance relative to the benchmark portfolios is measured in percentage terms.

On a relative basis, the Fund’s 10-year return outperformed the aggregated benchmark portfolios, generating 0.7% per annum of value added, net of costs. The benchmark portfolios’ fiscal 2026 return of 13.2% exceeded the Fund’s net return of 7.8% by 5.4%.

Significant concentration in public equities, with relatively heavier exposure to large-cap technology and communication services companies largely tied to artificial intelligence, were the principal drivers of benchmark portfolio performance in fiscal 2026. These companies delivered outsized returns compared to the wider universe of investable assets. By design, however, the Fund’s more diversified asset mix across public and private markets, sectors and geographies that helps reduce the impact of sharp equity market declines, limited participation in strong equity market rallies, such as those reflected in the benchmark portfolios’ public market indexes this past fiscal year. CPP Investments’ diversified portfolio is intentionally constructed to be less concentrated than public market indexes, with the purpose of enhancing the Fund’s resilience as it continues to grow over time.

For information on which of our decisions we believe are adding the most value, please refer to page 42 of the CPP Investments Fiscal 2026 Annual Report.

Asset Class and Geography Composition

CPP Investments’ portfolio, inclusive of both the base CPP and additional CPP investment portfolios, is diversified across asset classes and geographic markets.

Performance by Asset Class and Geographic Markets

Five-year Fund returns by asset class and geographic markets are reported in the tables below. A more detailed breakdown of performance by investment department is included on page 53 of the Fiscal 2026 Annual Report.

Managing CPP Investments Costs

Discipline in cost management is a main tenet of how we operate an internationally competitive enterprise that exists to create enduring value for multiple generations of CPP contributors and beneficiaries.

To generate $56.9 billion of net income, CPP Investments directly and indirectly incurred $1,757 million of operating expenses, $1,976 million in investment management fees and $2,758 million in performance fees paid to external managers, as well as $753 million of transaction-related costs.

Operating expenses were broadly flat in fiscal 2026, increasing by $1 million due to inflationary increases in personnel costs offset by lower general and administrative expenses. The net result is an operating expense ratio of 23.1 basis points (bps), below both last year’s 26.1 bps and our five-year average of 26.5 bps. We have also improved our operational efficiency, measured by net investments managed per employee, from $269 million in fiscal 2022 to $364 million in fiscal 2026, reflecting a 8% growth rate per year.

Management fees incurred increased by $216 million, driven by growth in externally managed assets. Performance fees increased by $535 million reflecting the positive performance delivered by our external managers.

Transaction-related costs, which increased by $23 million, vary from year to year according to the activity level, size and complexity of our investing activities. In fiscal 2026, we announced more than 50 transactions of $250 million or more, including approximately 20 transactions valued at more than $1 billion. Other categories affecting our total cost profile include taxes and expenses associated with various forms of leverage.

Refer to page 29 of the Fiscal 2026 Annual Report for more information on how we manage our costs and to page 50 for a complete overview of CPP Investments combined expenses, including year-over-year comparisons.

Operational Highlights for the Year

Corporate developments

• Once again ranked one of the world’s top-performing public pension funds by Global SWF when measuring annualized returns between fiscal years 2016 and 2025 (Global SWF Data Platform, May 2026).

• The Federal government announced, with the support of provincial and territorial governments, a proposed reduction in base CPP contribution rates (from 9.9% to 9.5%). This follows the most recent actuarial review released in December 2025, which confirmed the CPP remains financially sustainable and in a stronger financial position than in the previous assessment, supported in part by the growth of the CPP Fund and investment income over time. This underscores the long-term strength of the CPP and its ability to meet its obligations to current and future generations.

• Entered into a Memorandum of Understanding under the Canadian-Australian Pension Funds Investment Initiative (CAP Invest Initiative), which defines a voluntary commitment among leading pension investors to facilitate dialogue on investment environments and policy barriers to generate solutions that unlock greater opportunities for value creation.

• Ranked first among Canadian pension funds and second among 75 pension funds across 15 countries in the 2025 Global Pension Transparency Benchmark developed by Top1000funds.com and CEM Benchmarking, its fifth and final edition. The Global Pension Transparency Benchmark focuses on the transparency and quality of public disclosures relating to the completeness, clarity, information value and comparability of disclosures.

• CPP Investments Insights Institute (the Institute) published Investing in Uncertain Times: Achieving Disciplined Flexibility in the Total Portfolio Approach, the first in a two-part series on how the Total Portfolio Approach works in practice. As persistent geopolitical and economic uncertainty reshapes markets, the report explores how CPP Investments adapts exposures and reallocates capital through market cycles within a calibrated risk framework—supporting a resilient portfolio and the Fund’s financial sustainability over its 75-year horizon. In fiscal 2026, the Institute also published Investing in a Changing World: How Public Funds are Addressing Physical Climate Risk; The Longevity Dividend: The CPP, Canada and an Aging World; and Mapping Canadian Capital, an ongoing series profiling our $119.2 billion in Canadian investments.

Board appointments

• Welcomed the following appointments to our Board of Directors:
  • Gillian Denham, effective September 25, 2025. Ms. Denham has extensive experience on public company boards and is the former Head of the Retail Bank at CIBC.
  • Stephanie Coyles, effective October 10, 2025. Ms. Coyles is an experienced director and is the former Chief Strategic Officer at LoyaltyOne, Inc.
  • Elio Luongo, effective April 29, 2026. Mr. Luongo has more than three decades of experience in financial services and advisory and served as Chief Executive Officer and Senior Partner of KPMG in Canada.

• Barry Perry and Sylvia Chrominska were reappointed as Directors of the Board for three-year terms, effective September 25, 2025, and December 3, 2025, respectively.

Leadership announcements

• David Colla was appointed Senior Managing Director & Global Head of Credit Investments, effective April 1, 2026, and joined the senior management team. Mr. Colla joined CPP Investments in 2010 and most recently led the Capital Solutions group. He succeeds Andrew Edgell who will continue with the organization as a Senior Advisor.

Public accountability

• Hosted our first two in-person public meetings for 2026 in Calgary and Edmonton, Alberta, providing an accessible forum to ask questions of our senior leaders. Additional meetings, including a national virtual meeting, will be held in the fall of 2026 to reflect our continued accountability to the CPP’s more than 22 million CPP contributors and beneficiaries.

Transaction Highlights for the Year

Active Equities

• Invested C$73 million for a 0.8% stake in Definity Financial Corp, a property and casualty insurance services provider in Canada.

• Invested C$411 million for a 0.6% stake in Medline Inc., a medical-surgical products and supply chain solutions provider in the U.S.

• Invested C$322 million for a 0.1% stake in Hitachi, Ltd., which provides digital systems and services, green energy and mobility, and connective industry solutions in Japan and internationally.

• Invested C$320 million for a 1.5% stake in Informa PLC, an international events, digital services and academic research group based in the U.K.

• Invested an additional C$1.1 billion in Ares Management, a global alternative investment manager operating in the credit, private equity and real estate markets, resulting in a total ownership stake of 2.0%.

• Invested an additional C$594 million in DSV A/S, a Danish transport and logistics company offering global transport services by road, air, sea and train, resulting in a total ownership stake of 1.9%.

Capital Markets & Factor Investing

• Completed 34 co-investments alongside external fund managers through fiscal 2026, committing approximately C$3,640 million to macro-themed strategies in addition to equity trades in a variety of sectors, including communication services, consumer discretionary, and financials.

Credit Investments

• Committed US$250 million to Lumina Strategic Solutions Fund III and US$200 million to a discretionary Separately Managed Account. Lumina invests at scale in the Latin American special situations market.

• Committed US$1.5 billion to a separately managed account managed by Blackstone, which is designed to invest globally across diversified credit investments, including fund commitments, spanning private corporate credit, asset-based and real estate credit, structured products and liquid credit.

• Invested US$200 million in a preferred equity facility to support ProAmpac’s acquisition of TC Transcontinental Packaging. Headquartered in the U.S., ProAmpac is a leading global provider of flexible packaging serving a diverse range of end markets.

• Participated in a US$500 million senior term loan supporting Sixth Street’s acquisition of Global Lending Services, an auto financing solutions provider in the U.S.

• Invested US$75 million in the first loss tranche of a significant risk transfer issued by a scaled non-bank lender in the U.S.

• Invested US$200 million into a first lien term loan for Global Cellulose Fibers, a leading global producer of bleached softwood fluff pulp, based in the U.S.

• Committed US$205 million as part of a term loan credit facility to Emergent Cold Latin America, the largest cold storage operator in Latin America, operating 112 facilities across 11 countries.

• Invested £190 million in the primary commercial mortgage-backed securities debt issuance of Caister Finance, secured by a portfolio of U.K. holiday parks owned by Haven.

• Invested US$100 million into the preferred equity issuance of CI Financial, a global wealth management and asset management advisory firm headquartered in Canada.

• Invested C$225 million in a loan to construct a hyperscale expansion to a data centre in Cambridge, Ontario, Canada, funding 50% of the total construction cost, alongside Deutsche Bank.

• Invested A$300 million (C$264 million) in an Australian commercial real estate debt strategy managed by Nuveen, a global investment manager. The strategy will focus on institutional senior and junior loans secured by prime real estate across major cities in Australia.

• Invested US$300 million in the partial royalty monetization of Leqvio, a cardiovascular drug for the treatment of hyperlipidemia.

Private Equity

• Invested US$50 million in 9fin, alongside Highland Europe. Headquartered in the U.K., 9fin is an AI-enabled credit intelligence and workflow platform serving global debt capital markets.

• Committed JPY 11.75 billion (approximately C$100 million) to Bain Capital Japan Middle Market Fund II, which will target mid-sized companies in diversified sectors across Japan.

• Committed US$63 million to Dragoneer Select Opportunities Fund, which will focus on growth-oriented companies in the technology sector globally.

• Committed a combined US$145 million to Sands Capital’s Global Innovations Fund III, which invests in category-defining technology companies with an emphasis on long-term secular themes.

• Invested US$175 million in Aadhar Housing Finance, the largest affordable housing finance company in India, alongside Blackstone Asia.

• Invested US$27 million in Federal Bank, a private bank in India, alongside Blackstone Asia.

• Committed US$300 million to Francisco Partners VIII, which will focus on technology investments in North America and Europe.

• Committed US$50 million to NinjaOne through a single-asset continuation vehicle with Summit Partners. Based in the U.S., NinjaOne is a leading provider of cloud-based software solutions to outsourced IT managed service providers.

• Committed US$200 million to Thrive Capital X across its Early, Growth and Opportunity funds and invested US$18 million in OpenAI alongside Thrive Capital. Thrive Capital is a New York-based, multi-stage venture capital firm.

• Committed US$135 million to Consumer Cellular through a single-asset continuation vehicle with GTCR. Consumer Cellular is a U.S.-based cell phone provider that focuses on the 55+ demographic.

• Committed US$155 million across a16z’s Late-Stage Venture Fund V, AI Applications Fund X and AI Infrastructure Fund X. Based in the U.S., a16z is a multi-stage venture capital and growth firm that invests in disruptive companies and technologies.

• Committed US$100 million to Accel Leaders 5, which will invest in later-stage rounds of technology companies across the U.S., Europe and India.

• Invested US$100 million in Advent LAPEF VIII, a private equity fund that will pursue control-oriented buyouts and select minority positions across business and financial services, healthcare, industrials, consumer and technology sectors in Latin America, with a primary focus on Brazil and Mexico.

• Committed US$400 million to Bain Capital Asia Fund VI, which will focus on control buyout investments across Japan, India, China, Australia and Korea.

• Committed to invest an additional C$750 million through our established Canadian mid-market private equity program managed by Northleaf Capital Partners, supporting the growth and scaling of domestic private companies.

• Invested approximately US$600 million for a co-control interest in Boats Group, a global provider of online marketplaces for boats and yachts, alongside General Atlantic and existing investor Permira.

• Invested approximately C$60 million in Wealthsimple through a primary and secondary offering at a post-money valuation of C$10 billion. Wealthsimple is one of Canada’s fastest growing money management platforms.

• Acquired a US$135 million limited partner interest in TA Associates Fund XII via a secondary transaction. TA Associates is a global growth private equity firm investing in technology, health care, financial services, consumer and business services.

• Invested approximately C$1 billion in OneDigital, a U.S.-based insurance brokerage, financial services and workforce consulting firm. We invested together with funds managed by Stone Point Capital for a majority position in the company. The transaction will support the company’s continued growth through a combination of organic expansion and strategic acquisitions.

• Committed US$100 million to Glenwood Korea Private Equity Fund III, managed by Glenwood Private Equity, which will target mid-market control carve-out opportunities in South Korea.

• Invested approximately €275 million in IFS, acquiring shares from EQT alongside other investors. Headquartered in Sweden, IFS is a leading global provider of cloud enterprise software and industrial AI applications.

• Committed A$150 million (C$135 million) to Pacific Equity Partners PE Fund VII, which focuses on upper mid-market buyout opportunities in Australia and New Zealand.

• Sold our remaining approximate 36% stake in Informatica, an AI-powered enterprise cloud data management company, as part of Salesforce’s acquisition, generating net proceeds of US$2.7 billion. Our original investment was made in 2015.

Real Assets

• Committed US$400 million to Greystar Global Strategic Partners II (GGSP II) managed by Greystar, a global leader in property management, investment management, and development. GGSP II will provide equity to Greystar’s global investment offerings across a diversified portfolio of living sector real estate strategies.

• Committed approximately US$175 million to a real estate portfolio of senior living communities across the U.S.

• Agreed to invest approximately US$1.6 billion for a 60% controlling interest in atNorth, a leading Nordic high-density colocation and built-to-suit data centre provider, in partnership with Equinix who will own an approximate 40% stake.

• Agreed to acquire a 50% ownership interest in Inkia Energy, a private power generation company in Peru, at a total enterprise value of US$3.4 billion, alongside I Squared Capital.

• Committed to initially invest up to JPY 25.4 billion (C$222 million) to a Japan hospitality strategy managed by Singapore-based real estate investment manager SC Capital Partners Group.

• Formed a joint venture with Dream Industrial REIT and Dream Asset Management Corporation to acquire last-mile industrial properties in major markets across Canada. We have allocated C$1.0 billion of equity capital (90%) to the joint venture. The partners have agreed to acquire a portfolio of 12 Canadian industrial assets totaling 3.6 million square feet across Ontario, Quebec and Alberta, for a purchase price of C$805 million.

• Committed a combined US$310 million to U.S.-based Vantage Data Centers (Vantage), which provides data centre campuses to cloud providers and enterprises, as well as an additional US$200 million commitment across Vantage and Yondr, a global developer, owner and operator of hyperscale data centres.

• Invested US$1.0 billion for a strategic minority position in AlphaGen, one of the largest independent power portfolios in the U.S., alongside ArcLight Capital Partners.

• Entered into a definitive agreement to acquire an approximate 13% indirect equity interest in Sempra Infrastructure Partners, a leading North American energy infrastructure company, for approximately US$3.0 billion, alongside affiliates of KKR.

• Invested €234 million to support Nido Living, a European student housing operator, in its acquisition of Livensa Living, a student housing platform operating across Iberia. The acquisition positions the enlarged Nido group as one of the leading student housing operators in Europe, with approximately 13,000 beds. We acquired Nido Living in 2024.

• Committed JPY 192.5 billion (C$1.8 billion) in Japan DC Partners I LP, a data centre development partnership managed by Ares Management following its acquisition of GCP. The partnership will support the development of three large-scale campuses in Greater Tokyo to meet growing demand for scalable computing and AI solutions.

• Completed the sale of our 49.87% stake in Transportadora de Gas del Peru S.A., which operates Peru’s main natural gas and natural gas liquids pipelines under a long-term concession, to EIG.  Net proceeds from the sale were approximately US$820 million. Our original investment was made in 2013.

• Entered into a definitive agreement to sell our 49% stake in Island Star Mall Developers Private Limited, a real estate investment program in India, to joint venture partner The Phoenix Mills Limited and affiliates. Net proceeds will be approximately INR 54.5 billion (C$871 million) before closing adjustments. The joint venture was established in 2017.

• Sold our 50% interest in a portfolio of seven high-quality office properties in Western Canada to Oxford Properties for C$730 million. Our original investments were made in 2005 and 2016.

Transaction Highlights Following the Year-End

• Committed US$104 million indirectly in the acquisition of Zentiva, a leading European generics and over-the-counter pharmaceuticals company, alongside GTCR.

• Invested US$100 million for a minority stake in Sealed Air, a U.S.-based leading global provider of food and protective packaging solutions, alongside CD&R.

• Invested US$100 million in Accuity Healthcare, a leading provider of pre-bill, revenue integrity services to hospital and healthcare systems in the U.S., through a single-asset continuation vehicle managed by Frazier Healthcare Partners.

• Invested US$150 million in the preferred equity of Cerity Partners, a national registered investment advisor in the U.S.

• Committed US$1 billion in financing to Blackstone Private Credit Fund, which is a U.S.-based investment fund focused on providing senior secured loans to large, performing companies.

• Entered into a two-year forward-flow commitment with Global Lending Services, a U.S. auto financing solutions provider, to acquire up to US$1 billion of auto loans.

• Committed US$50 million to Accel Core, which will invest in Accel’s core technology sectors, expected to include artificial intelligence, security, developer tools, fintech, defense and software. Accel is a leading global venture capital firm.

• Sold Greenway Plaza, a mixed-use office property in Texas. No net proceeds were generated from the asset sale. Our original investment was made in 2017.

• Sold a diversified portfolio of 33 limited partnership fund interests in North American and European buyout funds to Blackstone Strategic Partners and Ardian, for net proceeds of approximately C$4.0 billion. The portfolio of interests represents various investments made in funds over the course of approximately 20 years.

To read our fiscal 2026 annual report, please click here.

About CPP Investments

Canada Pension Plan Investment Board (CPP Investments™) is a professional investment management organization that manages the Canada Pension Plan Fund in the best interests of the more than 22 million contributors and beneficiaries. In order to build diversified portfolios of assets, we make investments around the world in public equities, private equities, real estate, infrastructure and fixed income. Headquartered in Toronto, with offices in Hong Kong, London, Mumbai, New York City, São Paulo and Sydney, CPP Investments is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. At March 31, 2026, the Fund totalled $793.3 billion. For more information, please visit www.cppinvestments.com or follow us on LinkedIn, Instagram or on X @CPPInvestments.

You can download and read CPP Investments' FY2026 Annual Report here.

I had a chance to speak with CPP Investments' CEO John Graham earlier today, but before I get to this discussion, some of my observations on the results.

Before I get to our discussion, take the time to read the president's message below:

In a year of volatility and disruption, the CPP Fund (the Fund) did exactly what it was designed to do: remain resilient, grow steadily and help protect the retirement security of millions of Canadians.

The Canada Pension Plan (CPP) is one of Canada’s most important public programs and a cornerstone of retirement income for Canadians. Millions rely on it in retirement to provide a dependable monthly benefit that lasts for life and adjusts with inflation.

CPP Investments plays a distinct role in that system: we invest the Fund to help ensure the CPP is there for generations of Canadians. To keep the Plan financially sustainable, we must invest prudently through whatever the world throws our way.

The CPP remains strong and financially sustainable for generations

I’m pleased to report that the CPP Fund delivered strong performance in fiscal 2026 and the long-term financial sustainability of the Fund is secure.

In its latest report released in December 2025, the Office of the Chief Actuary of Canada reconfirmed that the CPP is financially sustainable for at least the next 75 years. The report also found that the funding outlook of the CPP – its expected ability to pay benefits over the long term – has strengthened since the previous assessment. Investment income also exceeded projections; between 2022 and 2024, it was about $80 billion higher than anticipated in the prior report. That independent, forward-looking assessment of the CPP’s ability to meet its obligations through changing demographics and economic conditions speaks to the Plan’s underlying health.

In fact, it is in part because of this underlying health that the federal government, with the support of provincial governments, announced in April 2026 a reduction in the contribution rate of the base CPP from 9.9% to 9.5%. This reduction will be implemented while maintaining benefit levels, supporting a strong, sustainable plan for current contributors and future retirees alike. As a pension fund investor whose role is to prudently grow the Fund so Canadians can rely on the CPP for generations, it is especially meaningful that we have been able to contribute to this outcome.

Strong long-term returns

The world is adjusting to a more fragmented global order, where trade and investment rules can shift quickly and uncertainty remains elevated. Market gains have been, at times, concentrated in a handful of large U.S. technology stocks, conflicts in Europe and the Middle East disrupted energy markets and renewed inflation concerns and shifting trade rules added to volatility. At the same time, artificial intelligence continued to move at pace from experimentation to production, reshaping capital spending and market leadership. These forces will influence investment opportunities and risks for years to come.

In fiscal 2026, the Fund delivered a net return of 7.8%, earned $56.9 billion in net income and ended the year at $793.3 billion, up $78.9 billion from last year. Public equities were a key driver of results, particularly in information technology in the first half of the year. Infrastructure, energy assets, and credit also contributed meaningfully. These gains were partly offset by foreign exchange losses as the Canadian dollar strengthened against the U.S. dollar, and by losses in government bonds, as central banks moved more cautiously on interest rate cuts.

For a pension fund designed to support generations of Canadians, long-term results matter most.

Over the past decade, the Fund delivered an annualized net return of 8.8%. Over that period, all our investment departments contributed positively to returns across very different market environments. This includes areas such as private equity, which is facing a more challenging period today, but has been a strong driver of absolute performance for the Fund over the longer term.

Over time, cumulative investment income has become a significant part of the Fund. At $549 billion, about 70% of the Fund today is a direct result of investment activity. That is compounding at work: patient capital invested across global opportunities with discipline around risk, liquidity and cost.

To understand performance, we look at it through more than one lens. The actuarial report provides an independent view of long-term financial sustainability. Absolute returns grow the Fund and help pay pensions. We also compare long-term results with global peers; Global SWF again ranked the CPP as the second best-performing pension fund globally on a 10-year basis. And we use sector and geography relevant benchmarks to assess relative investment performance. Together, these perspectives give a fuller picture of how the Fund is supporting the CPP for generations of Canadians.

Performance versus benchmarks

For the past three years, the benchmarks used to measure relative performance have advanced faster and higher than our more diversified portfolio built for long-term financial sustainability.

A component of the gap reflects a period in which large-cap, U.S. equities outperformed smaller companies and other geographies by a wide margin, while a relatively small number of technology and AI-related heavyweights drove a disproportionate share of benchmark returns. In addition, some parts of the Fund’s private-market portfolio – including private equity and real estate – faced cyclical headwinds, which weighed on more recent relative performance.

We did not design the Fund to mirror increasingly concentrated markets. Rather, we build resilience into the portfolio even as it is also designed to produce healthy returns over the long haul. Our investment portfolio is diversified by region, sector, and asset type, and actively managed to adjust to changing conditions. When market gains are largely driven by a single sector, our approach can lag for a period, but it is designed to reduce downside risk and keep the Fund resilient through many market cycles. That matters for a pension fund because the CPP must support contributors and beneficiaries through both strong markets and downturns.

Over 10 years, value added versus the benchmarks remains positive at 0.7%.

We remain focused on improving both the absolute and relative returns of the portfolio. Over the past year we reviewed the forces driving performance, challenged our assumptions and tested alternatives – including higher equity concentration, less diversification and different geographic mixes – to see whether they could improve outcomes without taking undue long-term risk. Some alternatives would likely have improved short-term results, but to the detriment of long-term risk-adjusted performance.

We have also taken a number of actions in response to recent performance, including sharpening how we assess and manage AI-related exposures, refining how we characterize private equity exposures and reviewing geography and sector positioning. All to help improve investment performance while maintaining the diversification and resilience required for a long-term pension fund. We believe that these new market conditions have revealed new opportunities to apply our enduring advantages: the ability to invest at scale, to partner with the best investors and operators, and to allocate capital flexibly across asset classes and geographies.

We remained disciplined on risk and liquidity. We have maintained an elevated level of liquidity in recent years, and that has served the Fund well during periods of market volatility.

Although markets have recently rewarded concentration, our conviction in diversification remains unchanged. We see diversification as both essential and an act of humility: no investor can reliably predict which narrow slice of the market will lead in any given cycle. While benchmarks matter because they hold us accountable and push us to keep improving, our goal is to build a portfolio that delivers the highest long-term absolute returns, with resilience, across changing market conditions.

Our investing activity, in Canada and beyond

Canadians rightly ask how the Fund invests at home. We apply the same return-and-risk discipline in Canada as we do globally, and we invest when opportunities meet our requirements.

At fiscal year end, we had $119.2 billion invested in Canada – an all-time high in dollar terms. We are encouraged by the attractive investment opportunities we are seeing in our home market.

This year we made a number of significant investments in Canada: we expanded our Canadian mid-market private equity program with Northleaf Capital Partners through an additional $750 million commitment; formed a joint venture with Dream Industrial REIT and Dream Asset Management to acquire last-mile industrial properties in major Canadian markets, allocating $1.0 billion; and invested $60 million to Wealthsimple, one of Canada’s fastest-growing money management platforms.

These investments reflect the same approach we use globally: backing strong businesses and assets, partnering with experienced operators and managers, and investing where we believe we can earn attractive returns without taking undue risk.

Around the world, our teams also continued to make investments that we believe will strengthen the Fund over the long term. This year, those included investments in atNorth, a leading Nordic built-to-suit data centre provider; Inkia Energy, a power generation company in Peru; and Hitachi,a Japanese technology conglomerate.

How we run CPP Investments: cost discipline, efficiency and governance

Managing a pension fund at this scale requires strong governance, clear accountability and careful risk management. CPP Investments operates with an independent, arm’s-length governance model. We manage market, credit, liquidity and operational and technology-enabled risks, including those arising from AI adoption, through robust frameworks and oversight built for a long-horizon investor.

We continued to focus on operating discipline. We now manage approximately $220 billion more in net assets with fewer employees than at the end of fiscal 2023, while investing in technology, data, and ways of working that allow the organization to scale efficiently.

Cost discipline matters because every dollar spent is a dollar not invested on behalf of CPP contributors and beneficiaries. As the Fund has grown, we have built a scalable model focused on doing more with the same base rather than simply growing our cost footprint. That discipline supports net performance.

Positioning the Fund for a changing world

The investment environment is changing in ways that matter for long-term returns. Conflicts, fragmentation, shifting trade and capital flows, the build-out of AI infrastructure, digital sovereignty and the whole-economy energy transition are reshaping investment conditions. We respond by building a portfolio that can perform across many scenarios and by investing where long-term fundamentals remain durable.

Conflicts, fragmentation and supply chains

Tariffs, trade disputes and geopolitical tension shape costs, supply chains and investment conditions across many sectors. Conflicts in Europe and the Middle East have also affected energy markets, shipping routes and inflation expectations. These pressures can create market dislocations and widen differences across countries and sectors. We invest through that reality by diversifying by country, sector and currency, and our global platform and long-standing relationships help us evaluate opportunities with local insight and partner with operators who understand their markets.

AI, infrastructure and digital sovereignty: investing behind the backbone

Data growth is increasing demand for data centres and the power and grid capacity behind them. Governments and companies are also paying more attention to digital sovereignty – the ability to store, process and move data within trusted systems and jurisdictions. We are increasing our focus on the infrastructure that supports the digital economy, including power generation and storage, transmission and grid upgrades, data hubs and related infrastructure, where long-term contracts and strong counterparties can provide stable returns.

Climate: protecting value through a whole-economy transition

Climate change affects risk and opportunity across the portfolio through physical impacts, regulation, technology shifts and changes in energy systems. Progress is not linear. We embed climate considerations into investment decisions across the Fund as we invest for a whole-economy transition. That means we stay invested across sectors and work with companies to reduce risk and protect value over decades rather than relying on blanket divestment.

Within each of these themes, the thread is the same: long-term investing requires patience, diversification and prudent risk management. It also requires learning and adapting as conditions change, without letting the latest narrative become the strategy.

Looking ahead

The CPP remains financially sustainable for generations, and the Fund continues to grow through disciplined long-term investing. In a world that will keep testing investors, CPP Investments will stay focused on what matters for a pension plan: resilience, sound risk management and strong long-term returns.

None of this happens without the dedication of our people. I want to thank all my colleagues across CPP Investments, including our Senior Management Team (SMT), for their hard work this year in pursuing our mandate with focus and care.

This year, we welcomed David Colla to the SMT, succeeding Andrew Edgell as Global Head of Credit Investments, following Andrew’s decision to become a Senior Advisor with CPP Investments. I want to thank Andrew for his leadership and contribution.

Uncertainty will persist. But the CPP was designed for exactly this kind of environment: to provide a dependable benefit, paid for life and indexed to inflation, through many market cycles. Contributors and beneficiaries can continue to rely on the CPP as a stable foundation of retirement income, and CPP Investments will keep investing the Fund with discipline so that foundation remains strong.

Now, before I get to my discussion with John Graham, I think it's critically important to go over some items in the Fiscal 2026 Financial Results Overview, which is available to download here.

I will not go over all the slides in this presentation, so take the time to read it here. 

One of the most important slides is this one on funding: 

The base CPP funding ratio improved (and the bulk of the assets remain there), allowing for a proposed cut in the contribution rate from 9.9% to 9.5%. This was attained because of stronger-than-expected investment income.

Next, performance relative to benchmark over a 1, 5, and 10-year period:

As you will see below, I got into this quite a bit with John Graham because critics will be focusing on 1-year underperformance of the Fund (-5.4%) relative to benchmark and we discussed this at length. 

Importantly, when you look at pension fund returns, you have to look at long-term returns to evaluate its performance and on this basis the Fund is still doing well.

The key culprits for the underperformance are well-known, concentration risk in US equity indexes remains very elevated, and that impacted relative performance, especially in private equity:

Despite the relative underperformance over the last 1 and 3 years, the Fund is not chasing returns and remains highly diversified to maintain its resilience over the long run:  And they are very careful about how they manage exposures:   This is critically important to remember because critics will focus on short-term performance and ignore the inherent risks of investing in passive equity indexes when concentration risk is high.

Again, I went over this with John, but I want to make it clear in my post that CPP will not/ cannot beat its benchmark every single fiscal year, especially when concentration risk is high and stocks are ripping higher. This is by design; the focus is on maintaining a globally diversified portfolio to maintain resilience over the long run.

The Fund also needs to manage its liquidity properly to make sure it can access funds when market dislocations occur and take advantage of them.

I am giving you important context to keep in mind before you read my discussion with John Graham below.

A few minor points of criticism that I shared with John and Frank Switzer during our discussion:

• CPP Investments needs to have a table next year where it discloses  its 1, 5 and 10 year returns by asset class relative to the benchmarks as well as total Fund level. This has to be in the press release and if possible, also do one by calendar year (I know, I'm asking for a lot).
• Next, CPP Investments invests in top hedge funds all over the world and also invests in emerging hedge fund managers. We need more transparency on the performance of this external manager portfolio (performance, etc.) 

Alright, long preamble but there is a lot to cover before I get to my conversation with John.

Discussion With CPP Investments CEO Going Over Fiscal 2026 Results

Earlier today, CEO John Graham called me to go over fiscal year results.

I want to begin by thanking him and Frank Switzer for setting up the call and sending me material early this morning.

John began by giving me an overview of total portfolio results:

The 10-year return of 8.8% which continues to be very strong, and I'd say comps well to global institutional investors. One-year return at 7.8%. Put that into context, we started the year this time last year we spoke, we were probably right into the kind of volatility of Liberation Day. We ended the year with the invasion of Iran, which obviously put the markets down for the last few weeks of the fiscal year, and through that, we had a market that rewarded concentration. 

We had a market that rewarded concentration, and I think continues to reward concentration, and continues to have valuations that in certain parts of the market, to be blunt about it, that we struggle with. 

So, we sit here today, and we sat there through the year. We have a pretty profound belief in diversification, even though diversification isn't paying off right now. And at a time when the range of potential outcomes is as big as it is today, we actually think it's time to lean into diversification and not lean out of it. 

I would say the results were from having a well-diversified portfolio across asset classes and geographies, and in some ways, trying to be less concentrated in the broader markets. 

I completely agree with him and noted in his message that he mentioned they looked at alternatives for taking more concentration risk in their public equity exposure: "Some alternatives would likely have improved short-term results, but to the detriment of long-term risk-adjusted performance."

I asked him to explain:

That's a little bit of what I was referring to. We spent a lot of time looking at some of the themes that were driving the market, and let's say the AI theme, and while we do have exposure to it, I think it's fair to say we're probably underweight compared to the broader markets. So, thinking about are there ways we would actually put in kind of a more concentrated exposure in, and if we did, how much would we want at the end of the day, you know, again we do have some exposure, but we're probably not at market weights. 

At the end of the day, we have a view that if we take a step back and say who we are and what we're actually solving for, and that's to contribute to the financial security and retirement of 22 million Canadians. There are times when you have to let the market run away from you. There are times when, if you look at the dispersion of outcomes, you know our mandate is to maximize return with that undue risk of loss, and you have to pay attention to that second point of the undue risk of loss. 

Now, we're not immune to a big market sell-off in any way, so I wouldn't want to give you that impression. But there are times when you think you know valuations are astronomical and you've got to make a decision that, as I wouldn't say we're a deep value investor, but we certainly believe in cash flows, and certainly believe in the long run you need to see cash flows that we'd rather be more diversified than concentrated.

That makes perfect sense to me. In fact, I told John this is how I read it. On a funding level, CPP is in great shape. The latest report from the Chief Actuary of Canada confirms this. 

But I told him, over the short-term, CPP Investments and other Canadian pension funds have been criticized for not keeping up with their benchmarks, and we know that there are benchmark issues, especially in this type of market where the share of the semiconductor sector reached a high of maybe 18 or 19% of the S&P and MSCI ACWI recently. 

I also noted hedge funds are driving these hot money flows, so he's right, chasing these stocks to keep up with the benchmark without consideration of risk is just plain stupid and dangerous.

So, I asked him point blank: "I think what you're telling me is you don't want to chase performance here, right?"

He replied:

Yes, that's right. So the way we think about performance is that we're close to CAD $800 billion AUM now, and you have to think about what that actually means from how you think about various alternatives. But there is a desire in this industry to reduce performance to a single number, and it's a little bit more complicated than that.

What I do is look at absolute returns, because you need to grow the fund. Relative performance is an important accountability framework, and it also provides a lot of insight into how your various programs are performing, but you can never lose sight of the purpose of the organization, and what the organization was actually created to do, and we're trying to jointly solve those three things, but it doesn't mean we put equal weight on each one at all time.

And you mentioned the funding ratio. The funding ratio is at 40%. It's what allowed the feds and the provinces to cut the contribution rate by 40 basis points, which is real money back into the pockets of Canadians, which is ultimately why we're here. 

So we jointly solve for absolute, relative and kind of the sustainability of the plan, but they aren't equally weighted. And in times like this, I'll say it to you, if somebody really outperformed their benchmark over the past year, I think you'd have to look hard at how they did it and what risk they took to do it. 

Again, I completely agree. I told him I have very close friends of mine who keep throwing in my face that the Norwegian sovereign wealth fund has outperformed all of the Canadian pension funds in recent years as the AI theme took off, at a fraction of the cost of Canada's Maple 8.

I told my friends that I know, I covered their 2025 results here, Norway's GPFG gained 15.1% in calendar year 2025, far outpacing all of Canada's pension funds but even that mighty fund, which has huge tech exposure and a different objective function, underperformed its benchmark last year.

All this to say, whenever I look at the performance of any fund, I look at the asset mix and the embedded risks in the portfolio, and try to understand it at that level.

I also stated the importance of looking at long-term performance for the Fund as a whole and by asset class where John remarked:

One of the things we did in this annual report is we put in 10-year returns, so maybe you planted the seed last year, but one thing in this annual report you will see is 10-year returns. I agree it's one thing that we've been trying to get more and more long-term, because that's what matters. 

If it didn't come out clearly in the report, I can take that away, but you will see when you get into the report that we did actually add commentary on 10-year returns, and I think that's a great segue to private equity (PE). Look, diversification means that some things are firing and some things aren't. If everything is firing, you're probably not diversified. 

The PE portfolio has been a long-term kind of contributor to performance. You get 10-year returns probably close to 12% for PE, but the short-term returns are challenged. And they're challenged in that you had a period of low distributions in the PE industry, and then the software challenges that in an asset class that had kind of gone overweight software.

PE, the way I think about it, is you have a, you have the stock in the flow, right? You have the portfolio that's in the ground, and then you have the new opportunities, and the stock has to be worked through. And broadly, in the industry, there are some challenges with the stock, but the flow is pretty interesting, and you've got to make sure you're not cutting off the flow because of decisions that you made five years ago around valuation.

What our PE team is doing -- and I'd be happy to have you spend time with Caitlin at some point -- they're actively managing the stock. You would have seen the press release about a $5 billion disposition to Blackstone and Ardian. 

This is all about managing the stock, and I've been pushing on the whole organization, even real assets, real estate, for the past five years, and it's probably my credit background. You've got to actively manage these portfolios, you got to embrace a relative value perspective. When the investment thesis is played out, even if it's a good asset, sell it and find a better place to put the money. So one thing is, over the past year, there was a lot of turnover in the portfolio, which is going to serve as well going forward, but it's, it's a lot of work. 

So, PE is definitely working through the working through the stock right now. I don't know, anything else I want to talk about PE. I can move on to the other asset classes. 

Indeed,CPP Investments has the biggest private equity portfolio in the world. It is selling C$4 billion in fund stakes to Blackstone and Ardian on the secondary market, creating liquidity in that portfolio to invest in better opportunities going forward. Y

Yes, they're taking a little bit of a haircut as they sell at a small but it doesn't matter over the longer term, as they are investing the money where they see better opportunities. 

I told John the thing with PE that scares me is whether there a profound structural change going on. Higher rates for longer, margin compression, much lower distributions, intense competition for assets throughout the industry, continuation funds to extend and pretend instead of taking a loss on an asset. It all makes me wonder whether the good old glory years are over for a very long time. 

John replied:

Yes, it's a good question. I think you got to go back to first principles with PE, and ask why do you invest in PE? Do you believe it actually can add value?  I think our kind of fundamental assumption is the governance model of PE allows the investor to get kind of right up close to the management team, and then drive some value creation through the organization. 

Undoubtedly, the industry benefited from multiple expansion and kind of cheap leverage for a long time, and going forward, those are not two sources of return that you should really be baking into any projections. And it's going to come down to who really has the ability to drive value through the through the organization, and if there is multiple accretion, is because the fundamental quality of the business. 

I think the asset class will come out in better shape from these challenges as they usually do, but there's going to have to be a bit of a shakeout. I think one of the questions that people have to ask themselves with private assets, like I think the institutional investor base also has to ask themselves, that when you have technology evolving at a quicker pace than your old period, what do you have to pay? Get paid for liquidity. What do you get paid to hold an asset for six to eight years with no liquidity on it? And I think we could have a debate as to whether or not liquidity has been properly priced in the market over the past few years or I should say, illiquidity. 

Another excellent point. I asked him whether they are happy here with 22% exposure to private equity or whether they are looking to lower it going forward.

He replied:

One of the reasons PE got to that size is because it had good returns for a long time. From an allocation perspective, it's probably pretty close. It is higher than what we would have liked, because you don't want to do anything unnatural with these illiquid assets. At 22%, it's probably at the high end, but we would never do anything unnatural to bring it down. 

I told him the reason why I ask him about PE exposure is that I see more opportunities in infrastructure right now, and from what I'm reading in their annual report, and in his message, particular data centers, energy, and so in the real asset classes. 

John responded:

I  think our appetite for PE and broader infrastructure are pretty similar, as long as we're getting paid for it in the real asset space. Energy is probably the one area that we've been pretty keen on for a while, and as you know, we have continued to invest across the entire energy spectrum. 

Our oil and gas portfolio did great over the past year, our LNG portfolio did great, our renewables portfolio did great. Energy is something that the world needs more of. The world needs more electrons, and so we're keen on growing that portfolio, and we're seeing lots of opportunities there, but I still like PE, and I still think on the flow side, there continues to be good opportunities. 

We have to take the long-term perspective here, looking at this market. I may have shared this with you before, it's been my experience in investing that this time is different, is over 10, and you  have to continue to maintain that long-term perspective. 

I asked if that is the same for real estate as well and he replied:

Look, we took some hits on real estate, and our real estate portfolio dealt a positive gain this year, but again, some of the data centers actually sit in our real estate portfolio and logistics has been good. We've got through the office and the retail pain. Our real estate portfolio, as you know, is smaller than some of the others, kind of six 7% and they're still active, looking for opportunities. 

There's a new global head of real estate there, Sophie van Oosterom, and she seems to be doing a great job thus far but that portfolio is still in transition and fundamentals there are improving. 

The other portfolio I asked John about was absolute returns, their massive external hedge fund portfolio made up of top global hedge funds and emerging managers. Heather Tobin, Senior Managing Director & Global Head of Capital Markets and Factor Investing, oversees that portfolio, and I wondered why they don't share a lot more public information on it.   

John replied:

I think we do disclose every manager on our website now, so I think every manager is disclosed on the website (some are listed here). I don't have a great answer for you. I'd have to look exactly what we put, because it's part of our CMF department, so we have a small systematic strategies group, but the CMF department that you see there, is almost entirely our external portfolio management team, which is the external hedge funds, and they had a great year. 

They've had a great few years. I think it's also fair to say that the hedge fund industry had its best year ever in the past year. 

[...] You should talk with Heather and Caitlin. I mean, PE and CMF, or the hedge funds. If we've had this conversation five years ago, everybody would have been gung-ho on PE and negative on hedge funds.

I will cover hedge funds tomorrow when I go over my quarterly activity but fair to say most of them jumped on the semiconductor trade in early April and are still riding it. 

I circled back to benchmarks and said benchmarks matter a lot, especially for compensation. I said comp was based on five-year returns (maybe four-year), so you can underperform your benchmark in any given year but if you underperform over a 5-year period, compensation will be impacted.

And this AI investment cycle/ bubble can last for another three years, nobody really knows so I asked how they will handle this. 

John responded:

So, as I look at this year, we've underperformed the benchmark three years running, and you know, and I think we got a good understanding why, and I think we have the conviction to maintain our current approach.

But as you know, markets can stay in their current state for a very, very long time, and if the markets continue to be concentrated like this, there's a good chance we'll underperform again if you get another 20% run by driven by a handful of companies. Institutional investors are not meant to keep up that way. It's a fact. I think that your math is correct, but you know that that's part of the part of how the industry works, right? 

I said that's the only fear I have with this concentration risk. It can last, "markets can stay irrational longer than you could stay solvent", is an old famous expression, and the markets can stay irrational, especially in investment-led AI fuel bubbles. 

That's one thing I realize, and we talk a lot about this throughout the industry, but you have to also remain disciplined. That's part of your focus. You can't just chase returns. It's going back to our initial conversation. You're going to get criticized by the Andrew Coynes of this world, but at the same time, you have to be very risk-conscious, a responsible fiduciary. 

I told him you have a responsibility to be highly diversified. 

John replied:

You mentioned something earlier, which I think is important to circle back to, when you brought up Norges. They run a very public strategy, so they're going to have a more kind of up and down portfolio by definition, but one of the things that gets forgotten in this, and you highlighted it, is pension plans have liabilities, and pension plans are created because of that liability, not because of the asset side.

You manage the assets to meet the liabilities, where sovereign wealth funds don't have liabilities, and that gets forgotten sometimes when people talk and mingle a sovereign wealth fund in a pension plan. To your point about comparing strategies, and even within the Maple 8, you have very different approaches to investing, because we have different liabilities and we have different kind of cash flow profiles. As we mature as an organization, now we're 27-28 years old, you see it, our approach is evolving based on what our liability stream looks.

I noted that additional CPP is much more diversified and much more risk-focused, because the liabilities are going to be changing, the profiles are going to be changing, and that additional CPP reminds me more, of what other Maple 8 pension funds are doing. I said base CPP is much more equity focused, private and public. 

He replied:

That's because base CPP is a partially funded plan, and so as base CPP becomes more funded, when we started out as about 15% funded, and now it's 40% funded. As it becomes more funded, one would expect that it will kind of converge to look like other plans. 

The additional CPP, for reasons of generational fairness, was set up as a fully funded plan with a really tight collar around it, so there's no real incentive to get it into a very overfunded status. That's why it has a very different risk profile, because it's 103% funded. 

I interjected, saying "so you don't want to get to 125% funded" and he added:

It actually can't, the way they set it up, it can't, because, but they didn't want that. They really wanted it to have a tight collar around it, and so to say to us, like, just keep this around 100 don't try to get it to 120 you're not being incentivized to do that.

I switched the conversation to discuss Canada, stating I know everybody's patriotic this year but I personally don't care if investments in Canada are increased unless it's in the right area (like infrastructure). 

I understand it makes a lot of people happy. What I care about is the CPP Fund is taking the appropriate risks globally, and focuses on global investments, and I want it to do well over the long run.

I asked John where they are in their discussions in terms of infrastructure opportunities opening up, and what he can share with my readers on this front.

He replied:

Sure. I think you got to remember that Canada is still our second biggest investment destination after the US. We have on a growth basis C$120 billion invested domestically. It's a big portfolio. I would share that our pipeline in Canada is probably the deepest it's been in my memory. 

We'll see what comes to fruition, and we'll see what really kind of plays out. Some of that is due to the ambition from the provinces and the federal government to actually do big things, and when you want to do big things, it attracts big money.

So, whereas we're seeing opportunities in de novo development, recycling of assets that we haven't seen before, but I would say it's very formative at this time, and I think you know various governments across the country need to figure out what they're solving for. Are they solving for privatization, are they solving for recycling capital, are they solving for improvement in operations, are they solving for someone taking over a capex program? 

Some of these details have to be worked out, and that'll be, but I think we're hopeful, Leo, that we're going to see some good opportunities. My view on it, for what it's worth, I'm a big believer that you need to have competitive capital, and if there are opportunities in Canada or any country in the world, you should have global and domestic capital looking at those opportunities, and competition is what drives better outcomes. 

Trapping capital doesn't lead to better outcomes. Having a competitive market leads to a more competitive economy

I noted CPP and PSP are hosting this conference on investing in Canada with global peers in September, and that is positive.. Yeah, so I think that's part of what you're getting at as well. It should be global and open to all the funds. It should be global, and it should be the biggest investor in the world. 

John added: 

I'll just say one last thing on it. We obviously have an opportunity to meet with investors all over the world, and one of the questions I always ask is, how much do you have invested in Canada, and the answer is typically less than 1%, which you could argue maybe is underweight based on the market cap basis, because Canada just hasn't been on the investment community's radar for a long time, 

But people are curious about Canada right now. I mean, people are more curious about Canada than they've ever been, and how do we turn that curiosity into interest? And that's a big job, right? I think it's better for us because it'll unlock opportunities. I think it's better for CPP investments. 

So, this summit is essentially one way for the country to showcase what it has to offer to the world, and I think in the longer term it'll increase the opportunity set for CPP Investments. 

I agree, we need global capital to enter Canada and this summit will be an opportunity for global investors to take a real hard look at what our country has to offer.

I ended our discussion on Credit investments, noting David Colla took over the helm of that important portfolio in February and asked him if he has any insights to share.

I said that despite all the negative press all year long about private debt funds being illiquid, and there being a liquidity mismatch going with retail investors, it remains an important asset class.

He replied: 

Credit is always close to my heart, and it's done great. I mean, we could talk probably a while, but you touched on the exact issue. You have to unpack it and say, if you take software out, yields basic or spreads, basically ended the year where they started. You definitely have some of the software challenges, which is coming from private equity, but with the retail and high net worth participation, you have a mismatch in the duration of the capital with the duration of the asset, and this is the growing pains of bringing high net worth and retail into illiquid asset classes. I think people got the reminder that semi-liquid means that you have liquidity when you don't want it, and no liquidity when you want it. 

We ended it there, I could have easily gone for another half hour but John and Frank had a very busy day.

Once again, I thank John for another insightful discussion, really enjoy talking to him because he explains things very clearly and carefully and doesn't avoid hard topics.

The key thing I got out of this discussion is the Fund is in great shape, it has more than enough assets to meet its future liabilities, they aren't chasing tech shares that are going parabolic, they prefer playing the AI theme in private markets via energy, data centres and other investments. 

Most importantly, despite underperforming its benchmark for a third straight year, the Fund remains globally diversified across public and private markets, sectors and geographies and will remain this way to make it resilient for decades to come.

Below, the CPP Fund increased by $78.9 billion, ending the year at $793.3 billion in net assets. CEO John Graham and other members of the team discuss results and \john even speaks French in this clip.

Also, Manroop Jhooty, Senior Managing Director & Head of Total Fund Management at CPP Investments, discusses fiscal 2026 year-end results, recent market activity and the year ahead. 

Lastly, Scott Sperling, THL Partners co-CEO, joins 'Squawk Box' to discuss the latest market trends, state of the private equity landscape, dealmaking activity outlook, and more. I recommended this clip to John and think you should all watch it.

The Canadian Press reports PSP Investments selling FirstLight's US portfolio, will keep Canadian operations:

The Public Sector Pension Investment Board has signed a deal to sell the U.S. operations of FirstLight to private equity firm Hull Street Energy.

Financial terms of the agreement announced Tuesday were not immediately available.

FirstLight's U.S. portfolio includes about 1.4 gigawatts of installed capacity across hydroelectric generation, energy storage and renewable assets in Massachusetts, Connecticut and Pennsylvania.

PSP Investments acquired FirstLight in 2016 and will keep the company's Canadian business under the transaction.

The Canadian operations include wind, solar, hydro, and battery storage projects in Quebec and Ontario.

The deal is subject to customary regulatory approvals. 

Freschia Gonzales of Benefits and Pension Monitor also reports pension fund sells 1.4 GW of US clean power assets:

PSP Investments is exiting its US clean power holdings while keeping its Canadian infrastructure intact. 

After nearly a decade of ownership, PSP Investments has agreed to sell the US operations of FirstLight to Hull Street Energy, a private equity firm focused on power infrastructure and energy transition investments.  

The portfolio comprises roughly 1.4 GW of hydroelectric, energy storage, and renewable assets across Massachusetts, Connecticut, and Pennsylvania. 

H2O Power and Hydromega, which make up FirstLight's Canadian platform, will remain under PSP Investments' ownership, alongside a development pipeline of wind, solar, hydro and battery storage projects in Quebec and Ontario.  

That includes the 57.2 MW Fort Frances solar project in Ontario, developed in partnership with the Lac Des Mille Lacs First Nation and recently awarded a 20-year power purchase agreement through Ontario's long-term energy procurement process. 

Andrew Alley, managing director and global head of infrastructure investments at PSP Investments, said the sale reflects the fund's approach to portfolio management while preserving exposure to Canadian projects with long-term, inflation-linked cashflows. 

FirstLight president and CEO Justin Trudell and the US-based team will transition with the assets to Hull Street Energy. 

The transaction remains subject to regulatory approvals. Evercore acted as sole financial advisor to PSP Investments, with Latham & Watkins and Foley Hoag as legal counsel.  

Martina Markosyan of Renewables Now also reports Hull Street to buy FirstLight’s 1.4-GW clean power, storage ops in US:

US power sector-focused private equity firm Hull Street Energy has agreed to buy clean power producer FirstLight’s US-based operations that include nearly 1.4 GW of installed capacity across hydroelectric generation, energy storage and renewable energy plants in three states.

The assets are being sold by the Public Sector Pension Investment Board (PSP Investments), which acquired FirstLight in 2016. Financial terms were not disclosed.

The portfolio to be offloaded covers assets spread across Massachusetts, Connecticut and Pennsylvania. FirstLight’s US-based employees, led by president and CEO Justin Trudell, will transition to Hull Street Energy as part of the deal.

In particular, Hull Street is acquiring the 1,168-MW Northfield Mountain pumped storage hydro facility in Massachusetts, which is described as the largest energy storage facility in New England. The package also includes 14 hydroelectric stations located in Connecticut, Massachusetts and Pennsylvania, plus three operational solar and battery storage facilities in the Northeast.

FirstLight’s Canadian operations -- H2O Power and Hydromega, are not included in the transaction and will remain under PSP Investments’ ownership. The Canadian platform includes the 57.2-MW Fort Frances solar project in Ontario.

The transaction inked with Hull Street is subject to customary regulatory approvals. The parties expect to wrap it up later in 2026.

The deal with PSP Investments comes after Hull Street's agreement last year with Consumers Energy to acquire 13 hydroelectric dams across Michigan. Following completion of the FirstLight and Michigan investments, the private equity firm will become one of the major hydropower investors in the country with a fleet of about 1,200 MW of flexible pumped storage hydro capacity and nearly 400 MW of hydroelectric capacity. 

 Yesterday, PSP Investments announced the sale of FirstLight’s US portfolio to Hull Street Energy: 

Montréal, Canada (May 19, 2026) – The Public Sector Pension Investment Board (PSP Investments) today announced that it has entered into an agreement to sell the U.S. operations of FirstLight to Hull Street Energy, a private equity firm specializing in power infrastructure and energy transition investments (the “Transaction”). The U.S. portfolio comprises approximately 1.4 GW of installed capacity across hydroelectric generation, energy storage and renewable assets in Massachusetts, Connecticut and Pennsylvania.

PSP Investments acquired FirstLight in 2016 and, over the course of its ownership, supported its growth into a leading clean power platform spanning hydroelectric generation, energy storage and renewable assets across the U.S. and Canada. 

The Transaction covers FirstLight’s U.S. operations, including the Allegheny Hydro portfolio. H2O Power and Hydromega, which together comprise FirstLight’s Canadian platform, will remain under PSP Investments’ ownership. FirstLight’s U.S.-based employees, under the leadership of President and CEO Justin Trudell, will transition with the assets under Hull Street Energy’s ownership, while the Canadian platform will continue to operate under its current leadership team in Canada. 

“We value what the team has built at FirstLight and are grateful for the support of PSP Investments during their ownership,” said Justin Trudell, President and CEO of FirstLight. “We are excited to continue leading the U.S. business and to be partnering with Hull Street Energy in this next chapter in the FirstLight story.” 

FirstLight’s Canadian platform will continue to be a best-in-class operator of clean power projects and will continue to develop and execute on its pipeline of wind, solar, hydro, and battery storage projects in Quebec and Ontario. This includes the 57.2 MW Fort Frances solar project in Ontario, which is being developed in partnership with the Lac Des Mille Lacs First Nation and was recently awarded a 20-year PPA through Ontario's most recent long-term energy procurement process. 

"We would like to thank the FirstLight team for their leadership, stewardship and collaboration throughout the development of the platform,” said Andrew Alley, Managing Director and Global Head of Infrastructure Investments at PSP Investments. “This transaction reflects our disciplined approach to portfolio management and return optimization while preserving exposure to projects in Canada with long-term, inflation-linked cashflows. We will continue to leverage our global expertise here at home to seek out new opportunities in the Canadian power sector." 

The Transaction is subject to customary regulatory approvals. Evercore acted as sole financial advisor and Latham & Watkins and Foley Hoag acted as legal counsel to PSP Investments.  

About PSP Investments  

The Public Sector Pension Investment Board (PSP Investments) is one of Canada’s largest pension investors with $299.7 billion of net assets under management as of March 31, 2025. It manages a diversified global portfolio composed of investments in capital markets, private equity, real estate, infrastructure, natural resources, and credit investments. Established in 1999, PSP Investments manages and invests amounts transferred to it by the Government of Canada for the pension plans of the federal public service, the Canadian Forces, the Royal Canadian Mounted Police and the Reserve Force. Headquartered in Ottawa, PSP Investments has its principal business office in Montréal and offices in New York, London and Hong Kong. For more information, visit investpsp.com or follow us on LinkedIn

Related to this, earlier this month, FirstLight executed a power purchase agreement for Fort Frances Solar Project:

• PPA signing marks a key milestone in advancing new solar generation in Ontario, with enough clean electricity to power approximately 8,000 homes 

Oshawa, ON — May 8, 2026 — FirstLight, a leading clean power producer, developer, and energy storage company wholly owned by the Public Sector Pension Investment Board (PSP Investments), today announced the execution of a Power Purchase Agreement (PPA) with Ontario’s Independent Electricity System Operator for the 57.2 MW Fort Frances Solar Project, in partnership with Lac Des Mille Lacs First Nation.

The agreement follows the Project’s contract award through Ontario’s Long-Term 2 (LT2) procurement process and represents a significant step toward delivering new, reliable and affordable clean electricity to the province. 

“The signing of this Power Purchase Agreement represents a major milestone for the Fort Frances Solar Project and formalizes its role in bringing new solar generation online in Ontario,” said Justin Trudell, President and CEO of FirstLight. “In partnership with Lac Des Mille Lacs First Nation, we’re proud to advance a project that will deliver reliable, cost-effective clean energy to the grid while creating lasting value for the community.”

 “We are proud to continue to leverage our global expertise here, in Canada. The Fort Frances Solar Project is a strong example of what we can achieve as a committed investor in the Canadian power sector,” said Andrew Alley, Managing Director and Global Head of Infrastructure Investments at PSP Investments. "We're thrilled to see FirstLight and Lac Des Mille Lacs First Nation recognized for their contribution to Ontario's electricity supply objectives — these are exactly the success stories that reflect the quality of our teams and the strength of our partnerships.” 

The Fort Frances Solar Project was one of 14 projects awarded contracts by the IESO, together representing more than 1,300 MW of new clean electricity supply for the province as it works to support forecasted increased electricity demand, while maintaining affordability and advancing carbon reduction goals. The Project builds on FirstLight and its predecessors’ more than 100-year legacy in the community through its 13.1MW hydroelectric project, Fort Frances Generating Station, which was built in 1909 and is located on the Rainy River. 

About FirstLight

FirstLight is a leading clean power producer, developer, and energy storage company serving North America. With a diversified portfolio that includes over 1.6 GW of operating renewable energy and energy storage technologies and a development pipeline with 4+ GW of solar, battery, hydro, and onshore and offshore wind projects, FirstLight specializes in hybrid solutions that pair hydroelectric, pumped-hydro storage, utility-scale solar, large-scale battery, and wind assets. The company’s mission is to accelerate the decarbonization of the electric grid by supporting the development, operation, and integration of renewable energy and storage to meet the world’s growing clean energy needs and deliver an electric system that is clean, reliable, affordable, and equitable. Based in Burlington, MA, with operating offices in Northfield, MA, New Milford, CT, Adrian, PA, Oshawa, ON, and Montréal, QC, FirstLight is a steward of more than 14,000 acres and hundreds of miles of shoreline along some of the most beautiful rivers and lakes in North America. FirstLight has been wholly owned by PSP Investments since 2016. To learn more, visit www.firstlight.energy or follow us on LinkedIn or X.

PSP Investments has decided to exit from FirstLight's US clean energy assets while retaining the Canadian ones.

Financial details of the transaction were not disclosed but these are high-quality US assets that will enable Hull Street Energy to become one of the major hydropower investors in the US with a fleet of about 1,200 MW of flexible pumped storage hydro capacity and nearly 400 MW of hydroelectric capacity. 

PSP will retain FirstLight's Canadian operations -- H2O Power and Hydromega -- a platform that includes the 57.2-MW Fort Frances solar project in Ontario (see the PPA agreement above).

Why sell the US operations but retain the Canadian ones? Is this about Trump and renewables being out of favour?

No, from my reading of it, the new global head of Infrastructure at PSP, Andrew Alley, wanted to realize on those US assets to invest elsewhere (more of a portfolio management decision and nothing to do with politics).

This deal represents a win for all parties involved because everyone got what they wanted.  

PSP will exit and invest elsewhere, Hull Street Energy becomes a dominant power player in US renewable energy and FirstLight will continue expanding its operations in the US and Canada under two distinct owners. 

Not much more I can add here but it's clear to me Andrew Alley has his vision for the portfolio and wants to execute on it.

By the way, the photo at the top of this post was taken when FirstLight was honored as the Alliance for Climate Transition’s Clean Energy Company of the Year at the Green Future Gala. 

Below, FirstLight is a leading clean power producer, developer and energy storage company that also serves as a steward of more than 14,000 acres of land and hundreds of miles of shoreline. 

In this company overview, hear from our leaders and learn more about our mission to accelerate the decarbonization of the electric grid by supporting the development, operation, and integration of renewable energy and storage to meet the world’s growing clean energy needs and deliver an electric system that is clean, reliable, affordable, and equitable (2024).

Also, Firstlight is advancing the energy transition and working towards the goal of reaching net zero emissions targets. In this video, learn more about how we do this by owning, operating, and developing hydroelectric, pumped-hydro storage, utility-scale solar, large-scale battery, and offshore wind assets(2024).

Lastly, Bloomberg QuickTake explores FirstLight's Northfield Mountain Pumped Hydro Energy Storage facility in supporting the transition to a clean energy economy (2022).

Freschia Gonzales of Wealth Professional reports Quebec pension giant bets big on Brazil's power grid:

Two of Latin America's largest energy infrastructure investors are consolidating their Brazilian transmission assets into a single platform, betting on the country's grid modernization push. 

La Caisse de dépôt et placement du Québec and Colombia-based Grupo Energía Bogotá (GEB) have signed a final agreement to merge their respective Brazilian power transmission holdings into a jointly controlled, 50/50 venture under the name Verene Energia S.A. 

The combined entity will hold 26 electric transmission concession agreements, more than 9,000 km of transmission lines, and over 400 employees across 17 Brazilian states.  

A scale the partners say places Verene among Brazil's top five transmission operators. 

Verene will pursue growth through network optimization, infrastructure expansion, and potential acquisitions, aligned with Brazil's broader decarbonization objectives. 

Emmanuel Jaclot, executive vice-president and head of infrastructure and sustainability at La Caisse, said GEB brings "more than 130 years of operating heritage" to the venture. 

Jaclot said the partners plan to grow Verene's footprint in Brazil through acquisitions and continued support for the country's energy transition. 

GEB president Juan Ricardo Ortega said the deal marks "a significant milestone" in the company's long-term Brazil strategy, citing the combination of GEB's regional expertise with La Caisse's financial reach. 

Financial close is expected by Q4 2026, pending regulatory approvals.  

On Friday, La Caisse issued a press release stating it and Grupo Energía Bogotá will establish Brazil’s 5th largest power transmission platform:

• The partners will co-control the joint venture on a 50/50 basis under the Verene name

Global investment group La Caisse, and Grupo Energía Bogotá (“GEB”), a leading Latin American energy infrastructure group, today announced that they have entered into a final agreement to create a jointly controlled, 50/50 power transmission platform in Brazil, bringing together their respective transmission assets in the country under a single joint venture which will retain the name Verene Energia S.A. (“Verene”).

The combined platform will comprise 26 electric transmission concession agreements, more than 9,000 km of transmission lines, and over 400 employees, with operations spanning 17 Brazilian states. With this scale, Verene will rank among the top five power transmission players in Brazil.

Verene will continue to operate as the reference platform for the combined portfolio and will be positioned to pursue disciplined growth opportunities in Brazil’s transmission market, including the optimization and expansion of existing networks and potential acquisitions, in line with Brazil’s broader grid modernization and decarbonization objectives.

Juan Ricardo Ortega, President at GEB, said:
“Our partnership with La Caisse marks a significant milestone in our long-term strategy for Brazil. By combining our operational expertise and regional market knowledge with the financial strength and global perspective of our partner, we are creating a platform positioned to accelerate growth, expand transmission energy infrastructure, and support Brazil’s energy transition. We believe this alliance will generate sustainable value for our stakeholders and contribute to Brazil’s economic and energy development.”

Emmanuel Jaclot, Executive Vice-President and Head of Infrastructure and Sustainability at La Caisse, said:
“By bringing together highly complementary assets under one banner, the partnership establishes Verene as a scaled, business-driven platform with strong financial backing. GEB brings more than 130 years of operating heritage and ranks among Latin America's leading energy infrastructure groups, with deep expertise across the region's transmission sector. Together, we share a vision to strengthen Verene's footprint in Brazil through value-creating acquisitions and continued support for the country's energy transition.” 

Financial close is expected by Q4 2026, subject to customary closing conditions and relevant consents and approval.

La Caisse was advised by BTG Pactual as financial advisor and Pinheiro Neto Advogados as legal advisor. GEB was advised by Citibank as financial advisor and Mayer Brown as legal advisor.

ABOUT GRUPO ENERGÍA BOGOTÁ

For more than 130 years, Grupo Energía Bogotá has contributed to the development of Latin America’s energy sector through the operation, development and investment in electricity and natural gas infrastructure. Headquartered in Bogotá, the company operates across Colombia, Peru, Brazil and Guatemala, with a diversified portfolio of electricity generation, transmission and distribution and gas transportation and distribution investments.

As a leading Latin American energy group, Grupo Energía Bogotá combines strong corporate governance, operational excellence and a long-term sustainability strategy to improve lives through competitive and reliable energy services. The company is listed on the Colombian Stock Exchange and continues to play a key role in the region’s energy transition and infrastructure growth. Learn more at Grupo Energía Bogotá and LinkedIn.

ABOUT LA CAISSE

For more than 60 years, La Caisse has invested with a dual mandate: generate optimal long-term returns for its 48 depositors, who represent over six million Quebecers, while contributing to Québec’s economic development.

As a global investment group, La Caisse is active in major financial markets, private equity, infrastructure, real estate and private credit. As at December 31, 2025, its net assets totalled CAD 517 billion. Learn more atLaCaisse.com, LinkedIn or Instagram. 

This is another great infrastructure deal where La Caisse is partnering up with Grupo Energía Bogotá (GEB) to invest in Brazil's power transmission lines. 

The new platform, a jointly controlled, 50/50 venture under the name Verene Energia S.A., will hold 26 electric transmission concession agreements, more than 9,000 km of transmission lines, and over 400 employees across 17 Brazilian states.  

The theme remains the same as other countries. Brazil is growing fast and wants to decarbonize its economy. That means more electric vehicles and higher demand for electricity. Add to this the needs of the AI economy, which means more data centres, and electricity demand will take off in a huge way there.

Are there risks investing in Brazil? Any time you invest in Latin American infrastructure or real estate, you're taking political and currency risk but La Caisse and other large Canadian pension funds know the country very well, and the top bank there (BTG Pactual) advised them on the deal, so I'm very confident the terms of the deal reflect all potential risks.

Again, Juan Ricardo Ortega, President at GEB, summed it up well in the press release when he states this:

“Our partnership with La Caisse marks a significant milestone in our long-term strategy for Brazil. By combining our operational expertise and regional market knowledge with the financial strength and global perspective of our partner, we are creating a platform positioned to accelerate growth, expand transmission energy infrastructure, and support Brazil’s energy transition."

In other related news, earlier today, a press release was issued where BIG Fiber secured $250 million in financing led by Stonepeak Credit and La Caisse to accelerate digital infrastructure expansion:

• Investment Fuels Expansion, Boosting Total Assets to over 800 Route Miles

BIG Fiber, a leading provider of high-capacity dark fiber infrastructure, announced the closing of a $250 million debt facility with an additional $100 million accordion feature. The financing, led by Stonepeak Credit and La Caisse (formerly CDPQ), provides BIG Fiber with significant capital to accelerate the expansion of its core markets and reinforce its position as the premier provider of mission-critical digital infrastructure in the U.S.

The new credit facility follows BIG Fiber’s 2024 milestone, the first-ever green loan in the dark fiber sector, and marks a significant scaling of the company’s financial capacity. Backed by sponsors Columbia Capital and SDC Capital Partners, the expansion of BIG Fiber’s debt facility and the infusion of new capital ensure the company remains well-positioned to meet the escalating infrastructure demands of the AI era.

Proceeds of the facility will be used to refinance existing debt, provide new capital and facilitate the necessary headroom for major network expansions already underway. This includes a significant multi-market buildout in Greater Atlanta, adding over 205 route miles and 165,000 fiber miles to BIG Fiber’s existing market-leading footprint.

“Our partnership with Stonepeak Credit and La Caisse marks a pivotal moment in our mission to empower our customers with highly-scalable and purpose-built dark fiber solutions," said Bruce Garrison, CEO of BIG Fiber. "This financing ensures we have the scale to stay ahead of the escalating demand for modernized infrastructure enabling the AI ecosystem and the necessary digital highways for decades to come.” 

"BIG Fiber’s infrastructure delivers critical bandwidth to meet the insatiable demand for both data and compute capacity across its key markets," said Arun Varanasi, Managing Director at Stonepeak Credit. "We are proud to partner with Columbia Capital, SDC Capital Partners, and La Caisse to support the Company's next leg of growth as it positions itself as one of the preeminent dark fiber operators in the country." 

“BIG Fiber is well positioned to meet the growing connectivity needs of enterprises and data centers seeking new, high quality infrastructure options,” said Jérôme Marquis, Managing Director and Head of Private Credit at La Caisse. “Its resilient business model, underpinned by long term contracts and strong structural demand, positions the company well for growth. Together with Stonepeak Credit, we’re providing a tailored financing solution that supports the continued build out of essential digital infrastructure.”

The latest expansion will bring BIG Fiber’s Atlanta and San Francisco Bay Area network capacity to 850 route miles and over 3 million fiber miles. Projects are currently under construction or contract, with phased Ready for Service (RFS) dates expected in early 2027.

About BIG Fiber

BIG Fiber is a metro dark fiber provider that offers high capacity, strategically placed, dark fiber networks to mission critical data centers, Hyperscalers and enterprises throughout the San Francisco Bay Area, Greater Portland and Greater Atlanta areas. BIG Fiber’s 100% underground network meets critical data needs for enterprises and data centers that require new, quality infrastructure options. BIG Fiber’s San Francisco Bay Area network offers more than 320 route miles and 65 data centers. The Greater Portland network has more than 20 route miles and 15 data centers, and the Greater Atlanta network has more than 550 route miles and 30 data centers. BIG Fiber was founded in 2019 and is headquartered in Sunnyvale, California. Visit www.bigfiber.com to learn more.

About Stonepeak Credit

Stonepeak Credit is the credit investing arm of Stonepeak, a leading alternative investment firm specializing in infrastructure and real assets with approximately $88 billion of assets under management. Stonepeak Credit targets credit investments across the transportation and logistics, energy and energy transition, digital infrastructure, and social infrastructure sectors that provide essential services with downside protection, high barriers to entry and visible, recurring revenue generation. It seeks to provide capital solutions that are flexible across the capital structure while generating cash yield through majority senior secured credit investments.

Stonepeak is headquartered in New York with offices in Houston, Washington, D.C., London, Hong Kong, Seoul, Singapore, Sydney, Tokyo, Abu Dhabi, and Riyadh. For more information, please visit www.stonepeak.com. 

This is another example of a private credit deal where La Caisse is partnering up with Stonepeak Credit to provide credit to BOG Fiber to grow its operations to meet the growing demands of bandwidth during the AI build-out phase.

Bruce Garrison, CEO of BIG Fiber summed it up: "This financing ensures we have the scale to stay ahead of the escalating demand for modernized infrastructure enabling the AI ecosystem and the necessary digital highways for decades to come.”  

What else? La Caisse is on record that it wants to double its allocation to private debt in the next 5 years and these are the type of large transactions that will enable it to get to its target.  

Jérôme Marquis, Managing Director and Head of Private Credit at La Caisse and his team are on pace to meet this target.

Below, understanding Brazil's Transmission Model: A Presentation by Luiz Barroso: CEO of PSR Energy Consulting and Analytics and former Director of Brazilian Energy Planning Agency (two years ago). 

In this International Online Conference for the African School of Regulation (ASR), Luiz Barroso explores the Brazilian electricity transmission business model. 

Excellent presentation, take the time to listen to his insights. 

Sean Conlon, Sarah Min and Lisa Kailai Han of CNBC report the Dow loses more than 500 points on Friday as tech slumps and yields spike:

Stocks fell on Friday, bogged down by losses in technology stocks and a rise in U.S. Treasury yields, after a summit between President Donald Trump and Chinese President Xi Jinping ended and left traders worried about no major policy breakthroughs.

The S&P 500 shed 1.24% to end at 7,408.50, while the Nasdaq Composite slipped 1.54% to 26,225.14. The Dow Jones Industrial Average was down 537.29 points, or 1.07%.

Investors took profits in tech after the group saw sharp gains recently. Notably, Intel retreated 6%, while Advanced Micro Devices and Micron Technology lost 5.7% and 6.6%, respectively. Nvidia dropped 4.4%, while Cerebras Systems — which surged 68% Thursday after it began trading on the Nasdaq — shed 10%.

“The group has witnessed an extremely unsustainable move in recent weeks and remains vulnerable to profit taking regardless of the headlines,” wrote Adam Crisafulli of Vital Knowledge.

Microsoft was an exception, however. The stock was 3% higher after Bill Ackman said Friday that Pershing Square has built a position in the name.

Treasury yields jumped, pressuring stocks, with the 30-year rate topping 5.1%. A series of reports this week showed inflation was revving back up as oil prices remain elevated from the Middle East conflict. Higher rates could hit the high growth stocks the hardest.

Oil prices traded higher Friday. U.S. West Texas Intermediate futures rose 4.2% to settle at $105.42 per barrel, while international Brent futures settled up 3.35% to $109.26. That’s after Trump told Fox News that he is “not going to be much more patient” with Iran, adding that “they should make a deal.”

Investors were disappointed following the conclusion of the summit between Trump and Xi, as no major deals have been announced. The two agreed that the Strait of Hormuz must remain open, according to a U.S. readout that was shared by a White House official. But “the few headlines that did come out of the summit (like the Boeing orders) were underwhelming,” Crisafulli wrote.

Boeing shares extended their losses Friday, moving lower by 3% following a nearly 5% drop in the previous session, as investors were let down by Trump saying that China has agreed to buy 200 Boeing jets — just 50 more than the company had previously anticipated.

Thursday marked a winning session for the indexes. The Dow reclaimed the 50,000 level, and the S&P 500 closed above 7,500 for the first time.

Stocks have been on a record-breaking tear on a renewed fervor around artificial intelligence. While Argent Capital Management’s Jed Ellerbroek believes sentiment among investors “remains very optimistic overall,” a peek under the hood is showing that the broader market is lagging the largest tech companies, a divergence that is increasingly worrying some investors as it suggests a fragile rally.

“It doesn’t feel right to say that tech is just going to lead forever,” the portfolio manager said, noting that the “HALO” trade earlier this year saw tech stocks “shunned” in support of those in sectors such as consumer staples and materials. “One thing kind of popping up and driving the market is inherently more risky than if there were several things.” 

Amalya Dubrovsky , Rian Howlett , Karen Friar and Grace O'Donnell of Yahoo Finance also report 

US stocks sank on Friday, retreating from record highs as rising bond yields and inflation worries preyed on markets and investors were gauging the success of the Trump-Xi summit in China.

The tech-heavy Nasdaq Composite (^IXIC) slid 1.5%, dragged lower by a 4% decline in Nvidia (NVDA), which reports earnings next week, and pressure on other chip stocks.

The S&P 500 (^GSPC) fell 1.2% after surging to all-time closing highs on Thursday, while the Dow Jones Industrial Average (^DJI) lost 1%, or 530 points, and dropped back below 50,000 as stocks came under pressure.

Stocks pulled back as a global bond rout weighed on sentiment to end the week, with the benchmark 10-year Treasury yield (^TNX) climbing to 4.59%, and the 30-year yield (^TYX) reaching 5.13%.

Investors also assessed the geopolitical backdrop as President Trump concluded his visit with Chinese counterpart Xi Jinping in Beijing. The two-day summit struck a business-friendly tone, involving 16 top US executives and delivering new deals for the likes of Boeing (BA) and Nvidia (NVDA).

However, the diplomatic issues of Taiwan and Iran continued to lurk in the background. US officials hoped that China could help end the war with Iran by using its influence with its major oil supplier. Trump said China and the US “feel very similar about Iran,” but Xi struck a more measured tone.

The lack of progress toward peace has stoked concern about the conflict’s price pressures, shown in this week’s US inflation readings. Oil futures rose over 2%, with Brent (BZ=F) trading around $109 a barrel. 

So the Xi-Trump summit happened and traders used it to sell the news.

Long bond rates keep inching higher and all of a sudden Wall Street is paying attention and decided to sell red-hot semis and other tech shares on Friday to buy energy and commodity stocks.

Still, for the week, while Energy outperformed all other sectors, Information Technology did manage to eke out a 1% gain (data source here):

As far as large cap shares, here were this week's top performers:

 And the worst-performing large caps (full list here):

 

So what does inflation pressure mean for the Fed and stocks going forward? 

Well, BCA's Chief EM/ China Strategist Arthur Budagyan posted this on LinkedIn earlier today:

I tend to agree, a 10-year above 4.5% will pose significant challenges for stocks but if earnings keep surprising to the upside, you never know, maybe there's more juice left to power stocks higher. 

Next week, King Kong (Nvidia) reports, so let's see the reaction afterwards. 

Below, CNBC’s “Halftime Report” Investment Committee debate whether it’s safe to buy the tech pullback.