TORONTO — Wood pellets producer Pinnacle Renewable Energy Inc, owned by Canadian private equity firm Onex Corp (ONEX.TO), wants to raise about $175 million through a Toronto initial public offering (IPO), people familiar with the matter told Reuters this week.

A successful deal would make it the second-biggest renewable energy IPO in Canada after TransAlta Renewables Inc (RNW.TO) raised $221 million in 2013, according to Thomson Reuters data.

British Columbia-based Pinnacle, one of the world's biggest producers of wood pellets, could file IPO documents as early as Friday, the people said.

ONCAP, a unit of Canadian buyout firm Onex that focuses on the middle market, acquired a majority stake in Pinnacle in 2011 for $71 million, according to ONCAP's website.

Onex has hired CIBC as the lead underwriter for the IPO, the people said, declining to be named as the information is not public.

CIBC declined comment. Onex and Pinnacle did not immediately respond to Reuters' requests for comment.