Ontario Teachers’ Pension Plan is in talks to sell its stake in Canadian oil and gas producer Aspenleaf Energy Ltd., according to people familiar with the matter.
The pension fund’s stake is worth around $200 million, with the entire company valued at about $800 million, said the people, who asked to not be identified because the details are private. A sale might close as early as May, they said.
Aspenleaf is backed by Ontario Teachers’ and ARC Financial Corp., a Calgary-based private equity manager that focuses on energy. The original private equity investment vehicle, formed more than a decade ago, is at the end of its life and other Aspenleaf shareholders are rolling their stakes into a continuation fund. But the Ontario pension fund has decided it would rather exit now, the people said.
The C$247.5 billion ($181 billion) Ontario Teachers’ fund, like many other pension managers, is under pressure to reduce the carbon footprint of its holdings — though it hasn’t made the decision to exit the fossil fuels sector entirely. A representative for Ontario Teachers’ declined to comment. Representatives for Calgary-based Aspenleaf didn’t immediately respond to a request for comment.
Aspenleaf is focused on drilling and acquiring light oil and liquids-rich gas assets in western Canada, with projects in the Swan Hills, Leduc, and Twining fields in Alberta. The company’s acquisition strategy focuses on buying financially stressed energy companies, injecting capital if necessary and using its operating experience to turn them around.
ARC was founded in 1989, initially with a focus on corporate advisory services and research before it evolved into private equity. Since then, ARC has raised 11 energy-focused private equity funds totaling over C$6.3 billion of committed capital from global institutional investors, according to its website.
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