Caisse Returns 4.5% on Equities, Inflation-Linked Assets
Caisse de Depot et Placement du Quebec Chief Executive Officer Michael Sabia said the pension fund manager would consider investing in BlackBerry Ltd. (BB) if the smartphone maker were to go private -- though he currently knows of no such deal being in the works.
Sabia made the comments after Montreal-based Caisse, Canada’s second-largest pension-fund manager with C$185.9 billion ($180 billion) in assets as of June 30, reported a first-half return of 4.5 percent. The Caisse held about 163,000 BlackBerry shares as of Dec. 31, according to its 2012 annual report, and hasn’t disclosed a more recent figure.
After losing subscribers in recent months, BlackBerry said Aug. 12 it created a special board committee that will evaluate all possible options, including joint ventures, partnerships or an outright sale. Prem Watsa, a Toronto businessman and BlackBerry’s largest shareholder, stepped down from the board, signaling that he may play a role in rescuing the company.
“If you’re asking me whether we’d be open to looking at something like that, of course we’d be open to looking at it,” Sabia told reporters today on a conference call from Montreal. “Whether we do it or not, I can’t tell you. I have no idea because that’s not something that’s on the table as we speak.”
Sabia’s comments echo those made by other pension funds, including the Canada Pension Plan Investment Board, which last week said it was looking at investing in BlackBerry if the opportunity arose.
The Caisse had C$7.8 billion in investment income in the first six months of 2013. Its performance matched the 4.5 percent average increase of Canadian pension funds this year, as estimated in a July report by RBC Dexia Investor Services.
Equities, which include public stocks and investments in closely held companies, drove the first-half gains with a 7.7 percent return. Inflation-sensitive investments such as real estate returned 6.5 percent while fixed income declined 0.9 percent, the Caisse said.
The Caisse oversees pensions for retirees in the French-speaking province of Quebec, with a dual mandate to maximize returns and foster economic growth in the province. The Caisse said it earmarked C$1.5 billion for investments in its home province in the first six months of 2013, including the creation of the C$250 million Sodemex Developpement fund to support natural resources companies.
Sabia said the Caisse stands by the management team of Rona Inc. (RON), the Quebec home-improvement retailer that reported lower-than-expected second-quarter profit two days ago after hiring Robert Sawyer as CEO in March. The Caisse was Rona’s biggest investor as of December with a 15 percent equity stake.
“Turning that business around is not an easy thing to do,” Sabia said of Rona. “Those guys are shoulder to the wheel, trying to turn around an important company. It’s not like opening a bottle of Coke -- it’s more complicated. We’re going to continue to work with them. They are doing good things, they are doing hard things, and they have our confidence.”
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