Global asset manager Schroders is to acquire a 75% share of renewable infrastructure manager Greencoat Capital, for an initial consideration of £358 million. The deal includes a potential earn out, payable three years after completion, which is subject to stretch revenue targets, the continued employment of the senior management team in the Greencoat business and is capped at £120 million.
The companies say they “have an ambition to be a global leader in this fast-growing and important investment sector”. They highlight the global transition to net zero and the accelerating institutional client demand for environmentally positive products. They want to tap US and European markets for renewable energy assets are forecast to grow by more than $1 trillion to 2030.Greencoat will become part of Schroders Capital, Schroders’ private markets division, and be known as Schroders Greencoat.
A series of options, exercisable by Schroders or the Greencoat management shareholders, are in place for Schroders to acquire the remaining 25% shareholding over time.
Richard Nourse, who founded Greencoat in 2009, said combining it with Schroders’ global distribution network and expertise “will enable clients to capitalise on the unequalled opportunity that our sector represents – a trillion dollar investable universe – and the chance to meaningfully support the global transition to net zero.”
Peter Harrison, Group Chief Executive of Schroders, said: “We are pleased to welcome the Greencoat team to Schroders. Greencoat is a market-leading, high growth business, with an outstanding management team, which provides access to a large and fast-growing market in high demand among our clients. Its culture is an excellent fit with ours and Greencoat’s focus aligns very closely to our strategy, continuing our approach of adding capabilities in the most attractive growth segments we can provide to our clients.
“We have demonstrated our ability to integrate acquisitions successfully, to generate growth and create significant value for our shareholders. We are confident that we will be able to leverage the strengths of both firms while preserving Greencoat’s differentiated position in the market.”