Tobey (Weintraub) Collins, Energy Transaction Expert and International Enthusiast

Tobey (Weintraub) Collins

SPEAKERS

Will Bachman, Tobey Weintraub Collins

So I joined AES at a really interesting time in the company’s history. AES had, at a corporate level, had just narrowly skirted a possible bankruptcy process. They ended up reaching an agreement with their creditors, and then they turned to a pile of debt that was sitting on a number of businesses and assets that they owned all across Latin America. So I joined right at that time, I spoke, I spoke Spanish and Portuguese. Piece I still do. And they were looking for people at at the headquarters based here in the DC area to to help with the restructuring of some of the debt at the businesses. And again, this is in the 2000 2003 to 2009 timeframe. So in the beginning of that era, I joined and and helped do restructuring of a number of the debt facilities on some of the businesses I worked at that time. I worked a lot in Brazil, and it was, was fun and exciting and stressful, but, but I’m a deal junkie, so to me, it was really, was really fun and interesting and helping kind of write all those businesses get the debt, you know, back in a in a place where it could be serviced comfortably by the by the businesses, so that, you know, everything sort of got back working on a on a good track, and then once we had sort of completed the cleanup operations, I was looking for a new opportunity, and they offered me the position to be the CFO of of AES business in Chile, Which at the time was, depending on how you measured it, either the third or the fourth largest electricity business in Chile at the time. So that was fun and exciting. Gave us another opportunity to go live overseas, which was also very interesting. And the business at the time needed quite a bit of capital. It was growing very quickly. Chile is a very it’s an A rated country for people who follow the financial ratings. And so it was a very attractive place to do business and and as was at the time, had a had a business plan to keep growing. So it was an exciting time to be there.

Will Bachman  11:36
You say you’re a deal junkie, I I’m I’m definitely not an investment banker, but I love reading money stuff, the column by by Matt Levine, as one of my favorite things to do every afternoon is take 10 minutes to read his column. And he talks about how investment banking is should be considered a liberal art, and where, you know, yes, there’s math involved in it. But there’s also it’s he thinks of it. There’s esthetic judgment required, and there’s, you know, there’s creativity involved in it. And so talk to me about any deals that you worked on as a deal junkie that you felt were particularly esthetically pleasing to you, or that you felt is very satisfying that where you, you know, contributed some sort of creative solution that the replacement investment banker you know would not necessarily come up with where you were above replacement value.

Tobey Weintraub Collins  12:35
Oh, wow. Well, I don’t want to comment on my on my replacement value, but, but it’s a good question, and I hope I’m not boring people, because I could talk about deals all day long. But one of the transactions I did here at Astris, so since I’ve been working again in and around the same types of issues, but being on the advisory side, so working with, you know, advising the owners of the assets on how to, you know, buy and sell and finance and refinance. And one of the most interesting deals we did was in Chile. And in Chile you have, and this was not when I lived there. I was living in DC at the time, but but did this transaction in Chile, and we were working with a new client. They had a portfolio of transmission lines. And in Chile you have very interesting framework. All of the transmission lines are owned by private companies, and they’re owned under a perpetual framework. So what that means is, as long as the transmission lines continue to add value to the system, you will continue to be paid for them. In many other countries, they have a limitation load, so you get paid for 30 years, which is often enough time to build and operate a transmission line. But the life of the asset, life of a transmission line and related substations can easily be 50 or 60 years or even more. So it’s a very interesting, it’s a very interesting sector in Chile, again, a very high, high credit quality country. So our clients had this portfolio of three transmission lines, and they needed to, they wanted to refinance them, and they had the revenue streams for these particular transmission lines were partially in US dollars and partially in local currency, and they wanted to extend the maturity of the debt. So they wanted to get as long debt as they could get, but they wanted the debt to match with their revenue stream, which was to say, partially in dollars and partially in local currency. And oftentimes, the way you would do that, in sort of a simpler structure, you would issue some kind of debt instrument in dollars, and then you would look to put on a currency hedge for the part of it that is in local currency, to make sure you could match the problem is, Chilean peso is a very small market. There’s not a very deep foreign currency market. So you really can’t get a hedge even today. And this was probably six or seven years ago, a little longer, actually, you can’t get a hedge that goes out anywhere near as long as the debt you want to get on ins, on assets that basically have a perpetual, effectively a perpetual revenue stream. So we proposed an idea that was innovative, and we worked really hard with with some investment, no some placement. Bank. So we were that kind of a deal. We were raising ~$650 million we had to, you know, we raised, worked with the big guys. And this deal we actually did with JP Morgan, BBVA and Goldman Sachs, but we proposed a structure where, actually we did two, what we called Twin bonds. So rather than doing one Don wand in dollars, we did one bond in dollars issued in the US market, one bond in Chile and pesos, which we did in the Chilean market, and we did them at the same time. So we managed to get ratings. We had all the documentation had to be matched, even though we had, obviously some in English and some in Spanish, the bond in Chile needed to be registered with the local with the local agency, the local equivalent of the SEC, let’s say, and the marketing process in the two mark two markets was completely different. But anyway, we managed to do it. So we managed to basically get them a perfect hedge on their revenue stream by issuing two bonds 30 years, which is quite a long time, particularly in emerging markets. And yeah, so we so we managed to structure that, put that together, get it through the rating agencies, sell it to the investors and put that in place. And that was very at the time. It had not been done before. And yeah, was really fun, and our clients were super happy. And I think since then, we’ve done five or six deals with them. So and in a small boutique advisory investment banking market, client relationships are, are where it’s at. So that was a pretty cool one,

Will Bachman  16:25
and in your current role at Astris tell us about, you know, any deals that you found particularly exciting to work on. I guess you can sanitize it obviously, if you want to protect client confidentiality, but tell us what kind of deals you work on.

Tobey Weintraub Collins  16:42
Now, let’s see my current in the in the last couple of years, my my focus has shifted more to the US. Previously, had spent most much of my career in in Latin America, and, you know, done a lot in a lot of different places in Latin America, but in the last couple years, I’ve been much more focused in the US. I should say the US and Canada, really, North America is big focus for us now. So we worked on an interesting as everybody probably knows, reading the newspaper battery storage is really a big hot topic in everywhere, really, but in the US and in particular. And we worked with a client that we had worked with in a number of different markets, in a lot of places in Latin America. We also worked with them in Europe. My firm also has a very big business in Europe, and they were looking at sort of really getting started in the Canadian market. And there was a very interesting opportunity going on in Toronto, where there was actually in Ontario, sorry, where the local utility was basically giving auctioning off long term contracts to incentivize people to build battery, big battery projects in in the province of Ontario, and so we worked with them. This was one of the first auctions of its kind. And we worked with our with our client again, who knew us from other markets, but we put together a very interesting bid. And when we do that kind of thing, we build the financial model. We have to think about how it will be financed, assuming they win the contract. So we worked with them and put that bid together, and then actually they were awarded. It took them six months to do the make the decisions as to who was awarded, but they were awarded the largest contract, actually, to build up to this, one of these big battery projects in in Canada. It’s currently still under the development phase, and then we will help with the financing, when, when it when the project is mature enough to do that. So that was cool, because battery technology is really interesting. I think it’s a great personally, I think it’s a it’s a compelling way to expand the the penetration of renewables and and it was a great opportunity to work with a client that we knew and a new market for them, and to help us grow our business in in North America.

Will Bachman  18:56
Talk to me about data centers in the US you see, as a civilian, the lay person you read about all these data centers, and they’re struggling to get enough energy generation capacity built. So some of them are built. You know, building it behind the meter. Tell us about any kind of exposure or insights you can share behind the scenes in the data world.

Tobey Weintraub Collins  19:19
It’s, it’s a hot topic, that’s for sure. I think this is something that’s on everybody’s minds. I think one thing that’s important to keep in mind is that ultimately, people won’t build the data centers unless they know they have electricity supply. It’s such an expensive undertaking for both people build the data centers, the people who use the data centers again, whether it’s hyper scalers, whether it’s storage or AI training, there are many different uses of the data centers, but at the end of the day, the data centers need more reliable energy than any other industry that I’ve ever worked with in before. You know the. So they need 99.999% availability of electricity, which is something that’s almost impossible unless you have full backup capacity, which they do, but unless they know at least this is my understanding. I’m not a Data Center Expert, but I know more about the power side. Unless whoever’s building the data center knows that they will have the electricity that they need, they won’t actually build it. So we have this concern that there won’t be enough energy for all the data centers that are getting built. But actually, those two things will really have to function together. No one’s going to build a data center and take the risk of whether or not they’re going to have enough electricity. So people are being really creative to try to figure out how to how to solve the problem. There’s this movement of bring your own power, which you hear a lot of people talking about, that can be behind the meter, or it can just be two projects that get developed at the same time. So it may be connected by the grid, may be several miles away, but it may be in the same, let’s say, zone, from an electricity perspective, but that a data center provider and a power provider get together and say, Okay, well, we’re going to have these two projects that are linked to one another. Or you can try to build your own power plant behind the meter, which, again, from a backup perspective, the data centers have been doing this for forever, because they always have a backup, you know, typically diesel generators, to make sure that they can, you know, that they can maintain their power supply. But it’s a big it’s going to be a big issue, certainly as the and we, you know, if you read about it, if you live in, you know, matter where you live, I think everyone is reading about it now, it’s going to create a lot of opportunity for investment and a lot of risks along the way, which is where, you know, people like me get excited, because that gives us something interesting. Something interesting to think about.

Will Bachman  21:44
Yeah, I read just last week that in the last four years, China has built the amount of electricity generating capacity that is equal to the entire US power grid, and that just blew me away. Tell us about what you see as the demand for electricity in the United States, and what’s, what’s kind of the limiting factor you know, as a lay person, not an expert, you read about how we were lacking in transmission lines, like we don’t have enough transmission to get the power from to where it needs to go. You’re reading about, you know, in some places like Texas, that are sort of blue red states, but they’re encouraging all sorts of solar and wind and battery. Tell us a bit about what you see as needs in the United States, and what are some of the barriers to getting

Tobey Weintraub Collins  22:43
it built? Sure, it’s a topic that’s that there many people who are far more expert than than I am. So the people who are listening, who who have different views. There are many different ways, I think, to answer that question or to but I can give you my thoughts. I think we’re at an interesting moment because the electricity demand in the US has been basically flat or growing very little over in the recent past, and now all of a sudden, we’re in a in a moment where everyone believes the demand is going to grow. There’s a lot of discussion as to how fast it’s going to grow, but everybody believes it’s going to grow. So we need more electricity. There are people who will tell you that we have plenty of electricity today. It’s just not in the right place or produced at the right time of day, and in certain markets, that could be the case. So the way to solve that problem could be through transmission lines. It could be through batteries or other types of storage devices, which can help load shifting is what we call it, right? Either moving the electricity from one place to another place, which is the transmission piece, or taking the electricity that’s produced during the windy time, which may be three o’clock in the morning, let’s say, and then being able to use it at between seven and 9am which is a time when there’s a lot of demand. So I think there that if we believe there’s enough electricity in certain places, those two pieces become really important. I think most people believe we do need more electricity capacity, generation capacity. So if you go, you know, if you think about the, let’s say traditional sources, and in that, I would include solar and wind. I mean, I think those have become at least onshore wind. Let’s stick to that our mainstream obviously, gas fired power plants can be very efficient, but they all have long processes, both from the perspective of, you have to find the right site. You have to get it permitted. If you have a gas plant, you need an air permit. You need all the, you know, all the infrastructure that goes along, kind of in and around a power plant. And then you need the transmission capacity, of course. So there’s a lot involved in building new capacity. And so that’s, that’s a piece of it, certainly new generation capacity, but it’s a question, I think, as to, you know what technologies and what locations and how fast it can be built. And then there are lots of people talking about small modular reactors, nuclear for. Instance, people are talking about geothermal. There’s a big interest, I think, in what new technologies could be out there. What else could help us solve this gap. In my view, those are still a little bit further away from everything that I’ve researched myself. Again, I’m not a technical person, but it’s a very interesting moment, I think, in my space anyway.

Will Bachman  25:24
So you’ve worked across Latin America. Next question is the one that could maybe get you in more trouble than anything else. I’ve asked your favorite cuisine in Latin America.

Tobey Weintraub Collins  25:36
Okay, so

Will Bachman  25:38
and why? And why is it Peruvian?

Tobey Weintraub Collins  25:40
Okay, well, okay, so that’s interesting. I was not gonna say Peruvian. Peruvian also has great food. I would say two things about Latin America. Latin America is a spectacular place, and I have spent a lot of time there, and it’s very near and dear to my heart. There are places where the local cuisine is fantastic, and there are places where there are amazing restaurants of many different kinds of cuisine, and it’s really interesting that you have both. My first food destination would, for sure, be Mexico City. I like spicy food, and so in Mexico you can get everything you want, but the Mexican cuisine is amazing. It’s very regional. You can go to different restaurants, different kinds of food, and it’s really, really different. The ingredients are different. The food in Mexico is amazing. You can also find excellent restaurants that are not Mexican food. So Mexico City kind of has it all. In my view. Lima is known Peru, of course, is known for its own cuisine, which is very delicious. It’s not as varied as Mexican at least in my experience, but they have fantastic restaurants. And you could go to Lima and just do nothing other than eat, for sure. But I would also include Brazil in my particular food journey. It’s definitely not as spicy. It’s the first place I lived overseas. So Brazil is very, very special to me. It also has a lot of regional cuisine and and a lot of really interesting and delicious you know, there’s meat heavy in the south, and Berry, fish and shellfish heavy in the Northeast, and kind of everything in between. So, and I love food. So I love food, and cooking is my hobby. So it’s a, it’s a big piece of my interest in the region.

Will Bachman  27:23
Okay, I’m also a big fan of Mexico district of federal. I did a semester business school there. So if you are going to Mexico City, which you said was your favorite place, what’s and you have just one night, what’s the restaurant you’re going to go to there, and what are you going to order?

Tobey Weintraub Collins  27:42
The second piece? I can’t say, because they change their menu all the time, but I would go to a restaurant that’s called, I think it’s called Carmel y Sal, if I’m not mistaken, it’s Oaxacan cuisine, and it’s great. It’s just a fun atmosphere. It’s really delicious food. But I think that’s where, I think that’s where I would go, actually, no, I think, I think, I think the food is from Jalisco. I think I said Oaxacan, but I’m pretty sure. Okay, and

Will Bachman  28:05
what about Brazil? Let’s say you’re going to Sao Paulo, where you lived, what would, what would the restaurant be, and what’s one of, what’s probably, what would you want to be ordering there?

Tobey Weintraub Collins  28:14
I don’t think I’m current enough. Well, restaurants in Sao Paulo, it’s been a while.

Will Bachman  28:20
What dish would you be looking for that you’re have?

Tobey Weintraub Collins  28:24
There are some delicious sort of stews from the Northeast which have just probably, you know, not something we’re ever supposed to eat, because it’s bad for you. But have palm oil in them, which is just a it’s an incredible flavor. If you don’t eat it very often, it can’t be that bad for you. But there are some, some, some stews which are often referred to as a moqueca. There are other kinds of there’s also something else called Camaro, Bobo de Camaro, which is also delicious. But I love the food from the from the Northeast of Brazil in particular.

Will Bachman  28:58
Now, you said earlier that you for your kids, that you vacationed all over so talk to us about that a little bit. You got beyond Latin America. And, yeah,

Tobey Weintraub Collins  29:09
we love to travel. As I said earlier, earlier, I hitched my life to an adventurer and and that’s been great. I really think it’s that’s, it’s been super fun. But we were just in Morocco. I mean, we took a vacation over the holidays, both of our now basically adult children. One, definitely an adult one, almost an adult children came with us, which was really fun. We have two boys. We all like to travel together. We do fairly well as a group. We have a lot of we like enough of the same things, and it gives us a lot to talk about. And everybody makes sure they have gets their own, get their own space while we while we travel. Morocco was one of the coolest places we’d been. I’ve been in a long time, just very different, really interesting experience. Food was interesting, but culturally learned a ton. And then a couple years ago, we we did the same thing the four of us, we. Went to Japan for two weeks. That was incredible. Food, unbelievable. Also, just learned so much a place where it’s so different from, you know, what we’re used to, and we’re used to Latin America and so so different. Also, just an amazing experience. I really feel like I love to go to new places. I like to have new experiences. I like to go somewhere where I’m little outside of my comfort zone. I don’t mind feeling like, you know, I have an F for foreigner tattooed on my forehead. It doesn’t, doesn’t bother me. We it’s fun. I really feel like it gives me, gives me better, better perspective, and I hope to keep doing it.

Will Bachman  30:40
So what was something about Morocco that stuck with you or that surprised you?

Tobey Weintraub Collins  30:49
Well, I would put two things. It surprised me. I guess it shouldn’t surprise me, how many residences The King has. Everywhere we went to we did a pretty good tour of the country and and the king has a residence everywhere, and on all the paths in between everywhere. I was surprised. I mean, I get again, I guess it makes sense, but, but that was the surprise to me. But what stuck with me was being in the Sahara Desert. That’s, that’s the place I would definitely go back. It’s, it’s really cool to be somewhere that remote, and when it’s clear, I know it sounds trite, but the the stars you can see, and there’s almost no ambient light, was really, really cool. It was very cold. We were there in the winter. It was very cold, but we were prepared for that. That wasn’t a surprise, but, but that was amazing. I mean, that was really very different from other places that that we’ve been. I could have spent more time there just staring out at the dunes during the day and at the store, at the stars at night.

Will Bachman  31:54
I’ve only been to Morocco for one day. When I was in the Submarine Force. We were pulled into Gibraltar. I managed to get away from my boat for a day to make a day trip. And what surprised me, or at least what stuck with me from that, was these like piles of mint just out on the sidewalk in front of cafes where they’d have been mentee and there’d be this pile of mint, like as tall as your hip. I I never seen anything like that.

Tobey Weintraub Collins  32:26
But what was interesting about the mint that we learned about the tea is that the, you know, official way to make tea uses not only several kinds of mint, but other herbs as well. So with anise and I know I won’t, I don’t remember what they were, but we went to this one really cool place where the guy was making tea, and I don’t know, he used seven or eight kinds of herbs, three or four different kinds of mint, and then all these other herbs. It was fantastic. Was really, was really cool. So I know what you mean. I didn’t see any piles as tall as my hip, but I can imagine them.

Will Bachman  33:04
I I did not know that about the different, different, wow, that’s like you got to be a super into your mint tea to say, oh, there was not enough. You know, spearmint, a little bit too much chocolate mint on that. Tell us about any courses or professors that you had at Harvard that continue to resonate with you in some way?

Tobey Weintraub Collins  33:28
Yeah, I would say that the I will answer that, I promise I would say that the thing I took away from Harvard, more than anything else, was really a group of mostly women that I’m still in touch with. I have to say that if I if that’s the lasting, the lasting gift that Harvard really gave me, that’s really carried through my whole life has been my my friends and the people that I still managed to stay in touch with after all these years. And that’s some of whom have been on your podcast before will, and some of whom have not, and maybe I will suggest them, but that’s really the that’s the biggest piece for me. That said I had a fantastic took a couple of classes with a fantastic professor, who, sadly, while we were there, Harvard did not give him tenure, which, which, I think was Harvard’s loss. A bunch of us were upset. Stephan Haggard. Is his name. I think he went out to the UC San Diego, I’m pretty sure. But he taught in the he was really focused on on Southeast Asia in particular, but really kind of in that kind of political economy space, of how you, you know, do business, but also sort of thinking about where, you know, international sensibilities, and kind of the intersection of politics and economy, particularly in developing economies. And I think if I think back on sort of how I’ve developed my career over time, I think a lot of the things I took in the several classes I took with him, although my interest ended up being in Latin America, I think it’s a very interesting comment. You know, it was kind of at the intersection of business and politics, let’s say, and so that was a that was the one I would, I would point to myself.

Will Bachman  35:10
Now, I’ve had one guest in the show who told me that he gets together with his roommates or rooming group, like, once a year at least, they’ll get together, sometimes with their family, sometimes without, and that’s kind of a defined set. Tell us about your group of women friends. You know you don’t need to name names, but how you know you can if you want. But how have you stayed in touch? Do you get together physically, in person, periodically. Do you go to each other’s, you know, special events, or do you talk on the phone a lot like, what’s, yeah, the type of interaction that you have with this, with this group of close friends?

Tobey Weintraub Collins  35:51
So it used to be a little bit more haphazard, let’s say, I mean, I think our, my group of of close friends, have been pretty good at going to reunions, and so we would see each other reunions, and we would have some interaction in between. And some of us probably saw each other more often than others. But as many of us in the class of 92 turned 50 in the middle of the pandemic, my husband was casting around trying to think of something to do. I my preference would have been to have a big party. I like to have parties. And he managed to get a zoom group together. Actually, two zoom groups together, one of my rooming group and one of another group of women that a couple groups of women that I was friends with who were not in my rooming group. And he organized these two zooms around my on my birthday, or around my birthday or something, and with my room and group, we just never stopped. So we have once a month since then. So that’s six years. Let’s say once a month we have a call. Not everybody joins every time, and sometimes we cancel it when everybody’s busy, but we’ve been pretty consistent, and it’s great. It’s an hour on a Sunday night, and whoever can join joins and, and that’s been really great. So now we have this more consistent touch point, and I hope we keep it up, because it’s really been it’s been fun. It’s been fun to feel reconnected with, with people and and then when you do it over the course of five or six years, you know, we don’t have to reconnect. We just, you know, pick up where we left off. And that’s that’s been really great.

Will Bachman  37:29
That’s awesome. Tobey, how can listeners best keep track of you or see what you have going on? Where would you point them online.

Tobey Weintraub Collins  37:41
I think LinkedIn is probably the best because it’s something that everybody carries with them from from place to place. So that’s, that’s what I would suggest.

Will Bachman  37:50
All right, we will include your link in the show notes. Tobey, thank you so much for joining today.

Tobey Weintraub Collins  37:55
Great. Thanks.