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UK govt sells green bank in 2.3-billion-pound deal

AFP  |  London 

The Green Investment (GIB), created by the British to fund environmental projects, is to be sold to Australian financial services firm Macquarie Group in a 2.3-billion-pound deal, the said today.

Under the deal, worth USD 2.6 billion, Macquarie has vowed to invest at least 3 billion pounds of new funds into Britain's green economy over the next three years.

The government, GIB's sole shareholder, launched the sales process to privatise the fund last year.

"The Green Investment has been very successful in attracting private capital to the UK's green economy," said Nick Hurd, Climate Change and Industry Minister.

"It now makes sense to move it into the private sector where it will be free from the constraints of public sector ownership".

Macquarie Group's David Fass said the deal "will open further opportunities in low carbon investment both in the and further afield."

The GIB was created in 2012 to attract private investment and has so far helped fund around 100 green projects with a total capital expenditure of around 3.4 billion pounds, including more than 1 billion pounds in large infrastructure projects.

The fund has invested in six offshore wind farms and a new energy-from-waste plant in North Wales.

The 2.3-billion-pound deal comprises a 1.7-billion-pound transaction price and a 0.6-billion-pound commitment for existing projects.

Robert Smith, chair of GIB's board, said there was "compelling logic" behind the deal.

"We were determined to find a new owner...Who would have access to deep pools of capital, a commitment to expand GIB's activities, and a respect for the unique role GIB has played in the market.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, April 20 2017. 18:07 IST