London: Australia's Macquarie Group has been forced to make a string of concessions with its £2.3 billion ($3.9 billion) takeover of the United Kingdom's Green Investment Bank after claims that it is the "worst kind of company" to be carrying out the company's environmental mission.
On Thursday local time Macquarie announced it had won the much-delayed bid to buy up the GIB.
The takeover means it will manage or supervise more than £4 billion ($6.8 billion) of green infrastructure assets and projects.
In a statement Macquarie Group said it was committed to maintaining the bank's "green purpose" through special share arrangements and independent trustees.
Significantly, Macquarie Group has also promised to keep the GIB's headquarters in Edinburgh following a fierce campaign from Scottish MPs to protect the organisation's jobs in Edinburgh.
Critics of the deal feared Macquarie — known in Britain as "the vampire kangaroo" and in Australia as the "the millionaire factory" — would buy up the bank only to embark on a round of "asset stripping".
Macquarie successfully defended a legal challenge to its takeover bid, launched by a rival bidder. That court victory nearly a fortnight ago all but assured the UK government's sale of the GIB to Macquarie would go ahead.
Head of Macquarie Capital Europe, Daniel Wong, said it was a "privilege" to acquire the bank.
"We will create a market leading platform dedicated to investment in the low carbon economy in the UK and beyond," he said.
"We Macquarie Group of Companies 2 understand the responsibilities that come with this ownership, and we are fully committed to maintaining its green purpose as we grow the business."
Macquarie said it would maintain the bank's target of £3 billion ($5 billion) of new investment in green energy projects over the next three years. "Under Macquarie's custodianship, the Green Investment Bank will operate in accordance with its green purpose and green objectives and in line with the 'special share' arrangements."
This will include publishing an annual report on its green performance, holding an annual industry day for stakeholders, and green reporting.
Lord Smith of Kelvin, independent chair of the GIB said Macquarie's "significant and important commitments" showed it could be a good custodian of the bank, but warned it would be held accountable.
"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," he said.
"We look forward to seeing these commitments from Macquarie delivered, in full, in the months and years ahead."
But the same commitments failed to satisfy key opponents of the bank's privitisation.
Former Liberal Democrat MP Sir Vince Cable. Photo: Supplied
The former minister for business and innovation Vince Cable told Fairfax Media the arrangements did not go far enough.
"The language is good but it's impossible to see how this will [be] enforced and sustained in the long term," the former Liberal Democrat MP said.
"The deal raises questions about whether the bank's valuable green mission can be maintained by a private company like Macquarie."
Mr Cable has previously described Macquarie as "the worst kind of company" to be charged with the GIB and said the Conservative government's privitisation was "uneccessary."
The Minister of State at the Department of Business, Nick Hurd, said the GIB had been a "success story", having attracted three times every pound invested in third-party funding.
In a written statement to parliament, Mr Hurd said the GIB could continue its success in the private sector.
"The deal... will meet the objectives outlined by government of securing value for money for the taxpayer while ensuring GIB continues its green mission, free from the constraints of public sector ownership," the minister said.