Palladium buys 8.5% stake in emerging markets impact house Bamboo Capital Partners

Move will see creation of $500m blended finance vehicle focused on the SDGs

Impact-focused consultancy Palladium has taken an 8.5% equity stake in Bamboo Capital Partners, a private equity impact investment firm specialising in emerging markets. 

Palladium launched its first impact investment fund last year, having acquired impact investment advisory firm Enclude (now Palladium Impact Capital) in 2018 from sustainability bank Triodos. 

The new deal with Bamboo Capital Partners is the first asset management acquisition for Palladium. Financial terms were not disclosed. 

Christopher Hirst, CEO of Palladium, told RI that the partnership sought to mobilise $1bn in impact capital by 2023.

“Our intention is that it’s a long-term partnership [with Bamboo Capital Partners],” he said. “The opportunity is there for us to increase our equity stake over time. We’ve structured it so that they operate separately, but the opportunity is there to learn and share the experience of our footprint and pipeline of projects we’ve been developing for ourselves. So there is a magnifying effect on what we’ve both been doing.”

The initial investment in Bamboo Capital Partners will be used to grow SDG500, a $500m blended finance impact investment vehicle, and create new products in the future. 

Palladium also houses the Positive Impact Research Institute, which includes Harvard professors Dr. Robert Kaplan and Dr. David Norton – developers of the well-known ‘balanced scorecard’ system. 

Over the last several years there has been a spate of ESG and impact houses being bought up by larger players. In 2019, Schroders acquired a majority stake in Swiss impact investor BlueOrchard and Australia’s Christian Super took a “significant minority shareholding” in Swiss impact asset manager responsAbility.

This spring, US-based sustainability specialists Capricorn Investment Group bought a 13% stake in fellow ESG house Osmosis Investment Management. And in January, ASX-listed Perpetual acquired SRI pioneer Trillium for $36m. In 2014 Trillium itself acquired environmental investment boutique Portfolio 21 .

NYSE-listed Eaton Vance acquired Calvert in 2016; and Impax Asset Management, part-owned by BNP Paribas Asset Management, bought US fund manager Pax World Management in 2018. 

In the same year, US asset management giant Federated Investors acquired a majority stake in Hermes Investment Management from the BT Pension Scheme.

Palladium’s new deal with Bamboo represents one of the first consultancy acquisitions in the ESG and impact investment space. Global consultancy Bain & Company made a minority investment in sustainability ratings firm EcoVadis, earlier this year, just weeks after private equity heavyweight CVC bought a $200m stake in the company.