Moody’s looks set to buy Vigeo Eiris

Deal would be the latest in a series of smaller ESG houses being snapped up by big finance groups.

Moody’s, the credit ratings agency, looks set to buy Vigeo Eiris, the Franco-British ESG research house. It is understood that talks on a deal were approved at Vigeo Eiris’ Annual General Meeting yesterday (April 11).
Moody’s London office is understood to be leading the proposed buy-out. Moody’s could not be reached for comment. Vigeo Eiris also could not be reached for comment by the time RI went to press, but it is believed the deal will be announced at a press conference on Monday (April 15).
Vigeo Eiris is headquartered in Paris and led by Nicole Notat, its President. Notat, a well-known figure in France, was the former secretary general of the country’s CFDT trades union. She founded Vigeo in 2002. Vigeo Eiris, which has a relatively complicated ownership structure, is reported to have reformed its capital structure in August last year. Vigeo and EIRIS merged in October 2015 to create a combined staff of 180+ with offices and operations in France, UK, Belgium, Italy, Morocco and the US. The two had a global network of ESG partner research firms in Australia, Brazil, Germany, Israel, Mexico, South Korea and Spain.However, the combined structure of the two entities is complicated. After the 2015 merger, Vigeo’s shareholder structure comprised three colleges: companies, including many of the biggest in France’s CAC40 share index (26%), asset and pension fund managers (55%), and civil society and trade unions (19%). The EIRIS Foundation, the parent company of EIRIS, was incorporated into the civil society college of the combined entity and held 20% of the capital at the time in the merged group. That shareholder structure has shifted in recent years. By July 30th last year, investment companies held 91% of the stock, trade unions held just under 6% and corporates held just over 3%. A Moody’s buy-out of Vigeo Eiris would be the latest recent tie-up between a relatively small ESG research house and a larger financial player. Morningstar took a 40% stake in Sustainalytics in 2017. And Institutional Shareholder Services (ISS), the proxy advisory firm, has bolstered its ESG offering with acquisitions of Germany’s Oekom, the climate data advisory division of Swiss-based South Pole Group and Scandinavian house Ethix. People with knowledge of the Moody’s-Vigeo Eiris talks said they believed a buy-out would be good news for both groups, enabling Moody’s to augment its ESG credentials and Vigeo Eiris to continue its expansion.