Regulators in the state of Minnesota have granted final approval for the acquisition of energy company Allete by Global Infrastructure Partners, the infrastructure division of BlackRock, and the Canada Pension Plan Investment Board, for a total of $6.2bn. The decision was reached unanimously in a vote by the Minnesota Public Utilities Commission, after contractual changes were introduced to mitigate concerns over customer rate impacts and investment commitments.
Additional guarantees for stakeholders
According to a recent regulatory filing, the parties agreed to add up to $258mn in additional benefits for Allete stakeholders, including bill credits for residential customers and a fund dedicated to energy technologies. These measures were key to securing the commission’s approval.
Commission Chair Katie Sieben stated that future investments would be significant, citing the construction of a new transmission line to bring hydropower from Manitoba. Commissioner Hwikwon Ham added that the regulator would retain the authority to review rates if contractual conditions were not met.
Broader context and expansion plans
The transaction forms part of BlackRock’s broader expansion in infrastructure. The group, which acquired Global Infrastructure Partners last year, is currently in talks to acquire a utility group and a data centre operator backed by Macquarie.
Initially announced in 2024, the Allete acquisition had faced opposition from several parties, including the Minnesota Attorney General’s Office and environmental groups concerned about potential rate increases and the lack of firm commitments to meet the state’s 2040 carbon-free electricity target.
Closing expected by end-2025
Executives from Allete and the acquiring entities welcomed the regulator’s approval. Allete Chief Executive Officer Bethany Owen said the agreement would allow the company to meet infrastructure demands without compromising service reliability or affordability. Jonathan Bram, founding partner at Global Infrastructure Partners, stated that the firm remained committed to preserving Allete’s community focus while continuing to deliver affordable and increasingly decarbonised energy in northeastern Minnesota.
The transaction is expected to close by the end of 2025, with all regulatory approvals now in place.
