Industry

M&G Fuels Impact M&A Trend

UK manager’s Swiss acquisition strengthens impact investing ambitions.

London-based M&G has become the latest large investment group to burnish its sustainable investment credentials by taking a position in a specialist impact investment firm.

The global asset manager, which has £370 billion assets in under management and administration, will take majority stake in responsAbility Investments, a Swiss impact investor focused on private debt and private equity across emerging markets.

Headquartered in Zurich, responsAbility has invested more than US$11 billion in private assets across emerging markets since it was founded in 2003. The firm, which has recently focused its investment strategy on companies with business models tied to the UN’s Sustainable Development Goals (SDGs), has approximately US$3.7 billion of assets under management.

M&G said the acquisition is in line with its strategy to grow its sustainable investment capabilities and become a leader in impact investing, while also expanding the firm’s international presence and private asset origination capabilities.

“This acquisition strengthens M&G’s position in the rapidly growing market for sustainable investments, especially in the exciting area of emerging markets. It also accelerates the growth of our private assets franchise and augments our European institutional distribution,” said M&G Chief Executive John Foley.

The acquisition, which initially sees M&G acquire approximately 90% of responsAbility’s issued share capital, is subject to regulatory approval. The business will remain headquartered in Zurich and its 200 employees will continue to serve clients and portfolio companies across more than 70 emerging markets from its eight offices. It contributes to UN SDGs by focusing on three core themes: financial inclusion, climate finance and sustainable food.

ResponsAbility will retain its brand identity and Chief Executive Officer Rochus Mommartz will continue to exercise daily oversight of the business.

“M&G’s financial strength, distribution network and its strong commitment to sustainability will accelerate our endeavours to meet the massive unmet demand in developing countries and the needs for climate finance. Together we can achieve an even more meaningful contribution to a sustainable world,” said Mommartz.

Pensions advisory and investment management specialist Cardano Group recently completed the acquisition of impact investor ACTIAM from Athora Netherlands, an insurance and reinsurance group. ACTIAM has £18.5bn in assets under management and nearly 30 years’ experience in sustainable and impact investing, especially in microfinance and SME finance, having launched its first impact investment fund in 2007.

In October, French insurance group AXA bought a 20% stake in Blue like an Orange Sustainable Capital, an impact investor specialising in sustainable infrastructure, technology services, social infrastructure, agriculture, and financial inclusion. AXA was an early investor in ‘Latin America Fund I’, the first sub-fund of Blue like an Orange Sustainable Capital Fund SICAV-SIF SCS.

Earlier in the year, former Aberdeen CEO Martin Gilbert took a stake in London-based emerging markets impact investor Alquity, just before being appointed chair of AssetCo, the investment vehicle which recently acquired River and Mercantile.

Australia’s Perpetual Asset Management (US$72 billion AUM) acquired impact-driven Trillium Asset Management, based in Boston, US, last January.

 

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