Michael Sabia, chief executive of the Caisse de depot et placement du Quebec, noted the economic importance of Quebec-based Rona to the province and to Canada, but wouldn't be drawn into political questions about the Caisse and the retailer.
"There's value that needs to be created, there's performance that's got to be delivered, there's a series of other factors as well," said Sabia, after the Caisse announced a 3.5 per cent return for the first half of 2012.
Rona announced the closure of a dozen warehouse stores in Canada earlier this year following disappointing results, however, it said recently that a shift to smaller neighbourhood stores is paying off.
The Caisse increased its stake in Rona (TSX:RON) by two percentage points to 14.2 per cent after Lowe's made its hostile takeover offer of $14.50 per share in July.
As for further increasing the Caisse's stake, Sabia was mum.
"That's not in the interests of people whose money we manage to signal to the market that way," he said on a conference call to discuss the Caisse's financial results.
The Quebec government, which is examining ways to thwart the Lowe's bid, has said the Lowe's takeover offer is not in the best interests of either province or Canada. However, the Caisse isn't getting involved.
"We operate in complete independence of the government of Quebec. We take our own investment decisions," Sabia said.
Both the Liberals and the PQ have pledged if they win the Sept. 4 provincial election to allow a company's board of directors to repel a foreign takeover if it's deemed to be against the interest of workers or the greater community.
The Caisse manages public and private pension plans. It was formed in 1965 to manage the equivalent of the Canada Pension Plan for workers.
The money manager has a mandate to help Quebec's economy with the stated mission to achieve an optimal return for its depositors while also contributing to Quebec's economic development.
For the first six months of 2012, the Caisse said its net assets reached $165.7 billion at the end of June, up $6.8 billion from $159 billion at the end of 2011.
By comparison, the Canada Pension Plan Investment Board recently said the fund held roughly $165.8 billion in net assets at June 30, up from $161.6 billion at March 31, boosted by $800 million in investment income and $3.5 billion in net CPP contributions.
The Caisse said its weighted average return of 3.5 per cent for the first six months of 2012 was slightly under its benchmark of 3.7 per cent, despite difficult global markets.
"It's a number we think is very well lined up with the needs of our depositors and the performance of others and, indeed, . . . well lined up with our reference portfolio," Sabia said.
The fund's investments contributed $5.4 billion to the increase and depositors made a net contribution of $1.4 billion.