21st Dec 2021 08:34
(Alliance News) - Schroders PLC on Tuesday confirmed that it has bought a majority stake in a renewable infrastructure investment manager.
The asset manager said it had reached agreement to acquire a 75% shareholding in Greencoat Capital Holdings for an initial GBP358 million.
Last week, Schroders had said that it was in advanced talks with Greencoat Capital LLP to buy a significant stake in the business.
The London-based money manager highlighted that Greencoat is one of Europe's largest renewable infrastructure managers, with GBP6.7 billion of assets under management at November 30.
Greencoat runs several funds including London-listed Greencoat UK Wind PLC and Greencoat Renewables PLC. The group also manages funds which are focused on solar assets, bioenergy and heat.
Schroders said the deal includes a potential earn out, payable three years after completion, which is subject to stretch revenue targets and the continued employment of the senior management team in the Greencoat business. It is capped at GBP120 million. The purchase price will be settled in cash.
Schroders explained: "Providing private capital for the energy transition required to achieve a net zero future will become increasingly important as governments around the world look to accelerate towards this goal. This is an area where we can support one of the most significant transformations required in economies worldwide to mitigate climate change. In addition, there is strong investor demand for such long-duration assets providing long-term secure income streams."
Shares in Schroders were up 1.8% at 3,434.00 pence each in Tuesday early trading in London. Shares in Greencoat UK Wind were up 0.4% at 139.33p, while Greencoat Renewables shares were flat at EUR1.09.
Following the deal, Greencoat will become part of Schroders' private markets division and be known as Schroders Greencoat.
Both Greencoat UK Wind and Greencoat Renewables highlighted that there would be no change to their relationship with the investment manager or to their investment strategy, following the deal.
By Will Paige; [email protected]
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