KKR buys sustainability consultancy ERM at $3 billion valuation
International investment firm KKR has acquired a majority stake in global consultancy ERM, in a deal that values the sustainability specialist at as much as $3 billion.
Environmental Resources Management (ERM) is a multinational consultancy headquartered in London. The company bills itself as the largest pure-play sustainability consultancy, supporting its clients across their green ambitions from boardroom to boots, with a focus on sustainability strategy and execution, health & safety, and implementing environmental, social and governance (ESG) best practices.
Over the past decade, ERM has been expanding at pace, accelerated by a buy-and-build strategy that saw over 20 acquisitions join its ranks since 2010, including First Option at the start of 2021 and Sustainalize last month.
Now, as ERM looks to maintain its momentum, the firm has secured a major injection of funds from KKR, one of the globe’s largest private equity groups (and a long-standing client of ERM’s consulting services). The move will see KKR acquire a majority stake in ERM from OMERS Private Equity and Alberta Investment Management Corporation, while ERM’s management team and partners remain as minority investors.
Keryn James, ERM Chief Executive Officer, commented, “At ERM, we are committed to working alongside every one of the world’s leading organisations to achieve their sustainability goals. This long-term partnership with KKR will allow us to expand and accelerate our client impact, and bring new capabilities and technologies to the business of sustainability.”
KKR’s investment is being made through its Core Investments strategy, which represents capital targeting longer-term opportunities. The deal is set to close in 2021’s third quarter, though financial terms of the transaction have not been disclosed.
Issuing a joint-statement on the move, KKR Partners Mattia Caprioli, Tim Franks and Ken Mehlman, Managing Director Franziska Kayser, and Director Rami Bibi, said, “True expertise in sustainability and environmental matters is more important than ever. We are proud to invest in a consultancy like ERM, as they continue to help organisations implement ESG management best practices across their operations.”
Globally, ERM has over more than 5,500 employees working from 160 offices in 40+ countries.
