Quebec's giant C$125bn (US$81bn) pension fund, Caisse de depot et placement (CDP), is part of a group financing Canadian home improvement outfit Rona's takeover of Revy Home Centres.
To finance the acquisition, Rona will issue C$60m (£27.2m) of equity and C$40m (£18m) in non-convertable debentures to its investors. CDP, as one of Rona’s backers, will invest a total of C$41.7m (£19m) in new shares and debentures for a 9.6% stake in the home improvement company.
Rona's two other investors are the Quebec state lending agency, SGF and French retailer ITM Enterprises. Like CDP, SGF will invest C$41.7m to each get a 9.6 per cent ownership of Rona.
The transaction is expected to close by early July, subject to some conditions and regulatory approvals.
Earlier this month CDP pulled out of negotiations for Canadian fund manager RT Capital Management. The pension fund said it was no longer in the running to purchase RT Capital Management and has terminated its discussions, in agreement with the parties concerned, regarding the purchase of the fund management company.
By Geoffrey Ho
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