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Macquarie-led consortium buys GIB for GBP 2.3bn
Posted on Thursday, 20 April 2017 11:14
The UK government has announced the sale of UK Green Investment Bank (GBI) to a Macquarie-led consortium for GBP 2.30 billion following delays caused by criticism from politicians and environmental campaigners alike.
Despite concerns the privatisation could lead to an asset-stripping, the Australian investment bank beat rival suitors to the punch for the company created to invest in renewable projects on commercial terms.
Macquarie teamed up with Macquarie European Infrastructure Fund 5 (MEIF5) and Universities Superannuation Scheme (USS) on the auction launched in March last year which drew a bid from Sustainable Development Capital.
In order to allay concerns, the deal includes a “special share” arrangement involving the appointment of five independent trustees to safeguard GIB’s green purpose.
Macquarie intends to make GIB its platform for spending in the UK and Europe’s renewable infrastructure by combining it with its own existing local clean energy investment arm.
This enlarged entity will continue to operate from offices in London and Edinburgh and is expected to be one of Europe’s largest teams of renewable project financing specialists.
It will manage or supervise more than GBP 4.00 billion of assets and projects and help establish three new investment vehicles – comprising offshore wind, low carbon lending and green infrastructure.
All three will have long-term backers; USS and MEIF5 are bankrolling the renewable power unit, and private pension scheme is joining UK investment trust GCP Infrastructure on the financing platform.
The government, which has provided GIB with total funding of GBP 1.50 billion since 2012, plans to take part in the proposed green infrastructure vehicle.
Macquarie has already committed to the bank’s new target of pushing GBP 3.00 billion into green projects over the next three years, either directly or by arranging capital from other investors.
The privatisation is subject to merger clearance by the European Union and is expected to take around two months.
© Zephus Ltd