REAL ESTATE – The CA$48bn (€31bn) Ontario Municipal Employees Retirement Scheme (OMERS) has appointed Michael Nobrega, the current head of its infrastructure subsidiary, as its new CEO.
Michael Rolland, currently senior vice president at Borealis, will take over from Nobrega as CEO of the CA$5.6bn infrastructure subsidiary later this month. The appointment follows his leading role in the CA$1.32bn acquisition in October of Canadian firm MDS’s laboratory test business.
As OMERS CEO, Nobrega replaces Paul Haggis, who announced his resignation from OMERS last month after an apparent disagreement over his role in the fund’s new governance structure.
Under the terms of his appointment, Nobrega will occupy the role until 2008, when he will present a new succession plan to the board. However, OMERS spokeswoman Debbie Oakley said his was not an interim appointment.
The board unanimously selected Nobrega from an unspecified line-up of internal candidates based on his "excellent relationships" with local, provincial and federal government leaders. He is also understood to be on good terms with trade union leaders and other OMERS stakeholders.
This contrasts with his predecessor, who is understood to have clashed with a number of board members and announced his departure just three years into the role. Oakley told IPE at the time: "Governance is not his [Haggis’s] expertise or interest."
Rolland takes over Borealis mid-way through a regulatory investigation into the 2002 transfer of the pension fund’s real estate fund management business.
In August, a Canadian appellate court allowed elements of a lawsuit brought by the Canadian Union of Public Employees (CUPE) Ontario – which makes up 40% of the pension fund’s membership – over the 2002 transfer of its real estate fund management business to Borealis.
Yet infrastructure investments have delivered for the fund. According to OMERS, Borealis’s infrastructure portfolio has returned 15%—22% annually over the past four years. OMERS has also announced an overall 16.4% return for 2006, driven largely by increased income from real estate and equity outperformance.
In a separate development, Borealis has continued its diversification into utilities via a partnership with Ontario Power Generation to build a gas-fired electricity generation system. Borealis will invest via its 10% share in electricity distributor Enersource, according to the Toronto Star.
Borealis’s infrastructure investments to date have included UK ports, Canadian energy distributor Scotia Gas Networks and a Canadian nuclear generation facility.