Canadian pension funds buy leading sustainability consulting firm ERM

US$1.7bn acquisition by Ontario’s OMERS and Alberta’s AIMCo

-

Two Canadian pension funds have agreed to buy leading corporate sustainability consulting firm Environmental Resources Management (ERM) for US$1.7bn (€1.5bn).

OMERS Private Equity, the arm of the C$72bn (€51.8bn) Ontario Municipal Employees Retirement System and co-investor the C$75bn Alberta Investment Management Corporation (AIMCo) agreed, in an off market deal, to buy UK-based ERM from €8.4bn private equity firm Charterhouse Capital Partners.

Founded in 1977, ERM has a blue-chip corporate client base, providing environmental, health, safety, risk, social consulting and sustainability related services. It has over 4,800 staff and 163 offices globally.

A typical project could be assessing the impacts of offshore wind farm proposals in the UK for E.ON, a social investment in Brazil for Devon Energy or conducting a sustainability audit for Unilever to ensure data accuracy for the Dow Jones Sustainability Index (DJSI). Its ERM Certification and Verification Services subsidiary provides greenhouse gas emissions assurance.

OMERS and AIMCo say they will support thedevelopment of ERM, both via organic growth and “strategic acquisitions” in a “fragmented sector”.

ERM had been majority owned by Charterhouse since 2011, when it acquired a 55% stake for $950m.

ERM runs a foundation which supports environmental initiatives globally, focusing on low carbon and climate change, conservation and biodiversity, clean water and sanitation and environmental education. In 2008 the foundation set up the Low Carbon Enterprise Fund (LCEF).

Last month AIMCo – which is co-owner, with the Ontario Teachers’ Pension Plan, of proxy firm Glass Lewis – was among five Canadian funds that wrote to Finance Minister Joe Oliver offering “support and encouragement” for the government’s efforts to work towards a global climate agreement during the upcoming international negotiations.

“We urge the Government of Canada to back clear emissions reduction targets supported by a transparent and predictable policy framework and to play a constructive role at the Paris climate change negotiations in December 2015,” they wrote.