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Sustainability, with global ambitions
Desjardins Capital invests $60M in QScale
In July 2021, Martin Bouchard, President of Québec-based Fonds QScale S.E.C. (QScale), announced a world-class project embracing both artificial intelligence (AI) and high-performance computing (HPC). Rolling out over the next seven years, the eight implementation phases of QScale’s bold plan will represent total investments of $867 million.
As a lead investor in the project, Desjardins Group will be on the front lines to support and foster this far-sighted undertaking: one of the most significant international initiatives combining artificial intelligence, circular economy, and sustainable investment.
QScale: for a sustainable future
QScale is developing infrastructure designed specifically for AI processing, by building large-scale, high-density campuses configured to operationalize machine learning and compute-intensive workloads.
Located in Lévis, opposite Quebec City, delivery of the first campus is scheduled for 2022. Developing the site’s potential for innovative collaboration, QScale‘s team plans to recover waste heat energy — excess heat generated by equipment — to operate a commercial-scale greenhouse farming venture sited in adjacent facilities.
“QScale is fulfilling Québec’s aspirations for our economy, know-how and sustainable development,” explains Bouchard. “This is an integrated, innovative, carbon negative project that meets the future head-on. I’m thrilled to be making this happen with my partners, Vincent Thibault and Dany Perron.”
Co-founder of successful businesses such as Copernic Technologies and 4Degrees Data Centers, Bouchard notes, “Québec has an abundance of low-cost hydroelectric energy derived from clean energy sources. And with the northern climate, the cost of cooling devices is significantly lower.”
A growing market
Data processing and cloud-computing have become essential services, with global demand doubling every quarter. A sea change that intensified during the pandemic. And significant growth of that scale offers its own fair share of opportunities for developing eco-friendly, carbon neutral energy solutions.
Demanding international clientele
QScale caters to clients with highly specific needs: facilities that have high-capacity, state-of-the-art power supplies to host high-performance compute-intensive AI and HPC data processing workloads. QScale‘s team will manage on-site maintenance, operations, physical safety and security, clients installing and operating their own compute servers.
Advanced connectivity thru major fiber-optic routes will secures QScale ability to host global leaders like Airbus, Pfizer or Tesla with the guaranteed capacity they need to maintain their most stringent AI processing standards.
The eight phases of this far-reaching project will represent total investments of $867 million. Phase 1 financing of $195 million has been completed. In July, QScale announced the Québec government’s contribution of a $60 million loan, in addition to a $30 million equity investment in the company. For Phase 1, Desjardins Capital is injecting $60 million in equity and repayable debt, with the remaining $45 million provided by private Québec investors.
Complementing Desjardins Capital’s investment, Desjardins Capital Markets will serve as lead arranger, bookkeeper, and administrative agent of the new bank syndicate. Strong synergy for Desjardins Group, whose head office and roots are in Lévis!
“Participation by the Québec government and Desjardins Group means this project is 100% Québec based,” declares Bouchard. “We’re inspired by the support of patient partners that embrace innovation and share our vision for the future.”
Desjardins: growing innovation
Québec’s leading private employer founded 120 years ago, Desjardins Group is highly recognized for supporting innovative projects. “We believe in QScale‘s business plan,” says Guy Cormier, Desjardins Group President and CEO. “This project aligns perfectly with our vision and our cooperative values. It demonstrates the very essence of the economic role Québec entrepreneurs play in growing Québec’s economy."
Desjardins Group’s business investment arm with more than $2.6 billion in assets under management, Desjardins Capital supports the growth and development of Québec-based businesses. “While this project is ambitious, Desjardins Capital recognizes the calibre of the entrepreneurs behind it, and we’re confident that their experience leading other successful businesses will be a major asset for QScale,” underscores Marie-Hélène Nolet, Desjardins Capital’s Chief Operating Officer.
“Given the vision of Martin and his partners,” she believes, “QScale is without a doubt going to place Québec among the world’s top data processing innovators. And what’s even more exciting, the project consolidates Québec’s role as a leader in technology, energy, sustainable development, and AI.”
The investment aligns with Desjardins Group’s 2040 goal of net-zero emissions across all operations and the financing and investment activities of its proprietary funds in three key sectors — energy, transportation, and real estate. Desjardins is committed to helping large businesses integrate environmental, social, and governance (ESG) criteria and reduce greenhouse gas emissions (GHG).
Acting now for future generations
In the same vein, QScale is building partnerships with education institutions to accelerate the development and reach of Québec’s cutting-edge robotization and AI expertise.
Desjardins plans to expand renewable energy financing through a dedicated $2 billion renewable energy infrastructure investment portfolio.
“Climate change has undeniable environmental, social and economic impacts,” sums up Guy Cormier. “We know our actions will shape the future of the planet for our children and that's why we’re stepping up our efforts to support a just energy transition and leading the way to a low-carbon economy.”