Starting April 1, the Minnesota Public Utilities Commission (MPUC) will hold a three-day series of hearings in St. Paul on the proposed acquisition of the electric utility Minnesota Power (MP).
Then, the MPUC will take their show on the road, visiting Cloquet, Duluth and three other cities within the utility’s northeast Minnesota service territory to gather public input.
Technically, it’s MP’s parent company Allete (ticker: ALE) that is being acquired, but it’s the utility angle that gives the MPUC jurisdiction over approval for the transaction.
Wisconsin regulators have already approved the deal (MP serves the city of Superior, WI) Allete is being bought out by a joint effort (40%/60%) of the Canada Pension Plan Investment Board (CPP) and the private equity fund Global Infrastructure Partners (GIP). GIP, in turn, was itself purchased last year by the investment company BlackRock (ticker: BLK). [Editorial note: satire is dead.]
An out-of-town preview of sorts was held on the deal last night before the Duluth city council. It did not go well. The Minnesota Star Tribune reports,
Protesters took advantage of a Minnesota Power presentation to Duluth’s City Council this week to oppose a private acquisition of the utility ahead of planned public hearings.
Apparently, the Duluthians who showed up Monday have less of a beef with their Canadian neighbors than with the GIP side of the equation. The fear revolves around potential job cuts and the potential loss of the MP corporate presence in Duluth.
From the MP point of view, the utility needs to raise a huge amount of capital ($4 billion) to pay for all that renewable energy being mandated by Minnesota state government. Raising capital is among private equity’s many activities.
Duluth TV station WDIO (ABC) has a more balanced report on the Monday city council meeting and previews the upcoming MPUC hearings.
The last MPUC hearing in the series will be held on April 11 in Little Falls.