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Green Investment Bank privatisation date nears

THE privatisation of the owner of Grimsby’s biggest and first operational wind farms – the Government’s Green Investment Bank – is expected to complete this month.

Green Investment Bank privatisation date nears

UK Climate Change and Industry Minister Nick Hurd announced in April the agreement to sell it to a consortium led by investment fund Macquarie, for £2.3 billion. The deal was approved by the European Commission last week.

GIB, set up to help overcome fledgling technology finance issues, bought Lincs, the 270MW farm, from Centrica, as well as a share of Lynn and Inner Dowsing. It was also part of the Westermost Rough funding team, with chief executive Shaun Kingsbury speaking in Grimsby at the launch.

Macquarie is already a 50 per cent stakeholder in Race Bank offshore wind farm after completing a £1.6 billion deal with Dong Energy in December last year.

Lord Smith of Kelvin, independent chair of GIB, said: “The GIB Board supported the decision to privatise GIB as it believed that attracting new investors was the best available route to securing the long-term future of the business and its growing green impact.

“The UK Government has run the GIB sale process and has now reached a final decision on its outcome. The GIB Board has provided its views to ministers at key stages. Those views related to the future prospects of GIB, its continuing growth and its leadership role in green investment. GIB is a highly valued institution and commitments over its future are important to its many stakeholders.

“Macquarie has made significant and important commitments to the UK Government to maintain GIB as a discrete entity within its business, maintaining GIB’s investment focus and approach with a target to invest more capital each year than GIB has historically. Macquarie will also uphold GIB’s green investment principles and report transparently on GIB’s green impact.

“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. We look forward to seeing these commitments from Macquarie delivered, in full, in the months and years ahead.”

The Humber, with Leeds as a financial centre too, had hoped to bring in the GIB headquarters when first launched, but it went to Edinburgh.

The investment ramped up over the past 12 months, with Lincs was sold in January for £730 million, with Siemens offloading its 25 per cent stake at the same time. Dong retained its 25 per cent stake, and is now going on to control operations and maintenance.

Lynn and Inner Dowsing was bought in a £423 million deal, completed last year.

Lord Smith added: “In the four years since its inception GIB has become an important business in, and for, the UK. It is widely admired, across the world, as a stand-out success story and has provided a model of good policy that other countries are now following.

“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 deal is expected to complete this month. ‘Special share’ arrangements are being made to safeguard its green purpose which will be held by five independent trustees. GIB manages or supervises £4 billion of green infrastructure assets and projects.

Daniel Wong, head of Macquarie Capital, Europe, said: “It is a privilege to be selected by HM Government to acquire the Green Investment Bank. The Green Investment Bank is a pioneering business, with outstanding people, expertise, credentials, brand and networks. 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 UK and beyond. We understand the responsibilities that come with this ownership, and we are fully committed to maintaining its green purpose as we grow the business.” 

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