Green Investment Bank to be sold off in £2.3bn deal

20 April, 2017, 13:56 | Author: Leticia Walters
  • HeraldScotland

The UK Government has completed the sale of the Green Investment Bank (GIB) to Australian investment bank Macquarie today (20 April) for around £2.3bn, a flurry of reports have claimed.

"By combining the Green Investment Bank with the largest infrastructure investor in the world, we will create a market leading platform dedicated to investment in the low carbon economy in the United Kingdom and beyond", said Daniel Wong, head of Macquarie Capital, Europe.

Macquarie has committed to a £3bn target for new green infrastructure investment over the next three years as part of the acquisition with GIB to be the primary vehicle for renewables spending in the United Kingdom and Europe.

Significantly, Macquarie Group has also promised to keep the GIB's headquarters in Edinburgh following a fierce campaign from Scottish MPs to protect the organisation's jobs in Edinburgh.

USS is putting cash into a new offshore wind power fund, the GIB's second - and Macquarie said it will also deploy capital from one of the infrastructure funds it runs on behalf of other investors.

In a statement Macquarie Group said it was committed to maintaining the bank's "green purpose" through special share arrangements and independent trustees.

An official announcement is expected to be made by Nick Hurd, the climate minister, on Thursday, the Guardian understands.

Head of Macquarie Capital for Europe Daniel Wong says: "By combining the Green Investment Bank with the largest infrastructure investor in the world, we will create a market leading platform dedicated to investment in the low carbon economy in the United Kingdom and beyond".

"We have secured fair value for the United Kingdom taxpayer". The bank, based in Edinburgh, will also continue to operate its two offices in Edinburgh and London.

Since its creation in 2012, the GIB has committed £3.4bn in public money to low-carbon projects, including offshore wind farms, low-carbon heating networks, and energy efficient street lighting roll-outs, building a portfolio of assets worth more than £12bn. It has shown, as it set out to do, that green investment can be both green and profitable.

"We Macquarie Group of Companies 2 understand the responsibilities that come with this ownership, and we are fully committed to maintaining its green objective as we grow the business".

"On the basis of these commitments, we believe Macquarie can be a good owner of GIB and we support the Government's decision to sell GIB to Macquarie".

"GIB in private ownership can, and should, continue to play an important leadership role in supporting the global low carbon transition and the UK Government's ambitious plans for a strengthened industrial strategy and emissions reduction".

The Labour party, Liberal Democrats, Greens and former Conservative ministers have all raised concerns in the past that privatisation may see the bank lose its environmental objective. By combining the GIB with the largest infrastructure investor in the world, we will create a market leading platform dedicated to investment in the low carbon economy in the United Kingdom and beyond.

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