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Pax World acquired in $90M sustainable investing deal

Merger fever has reached sustainable investing as well.

Portsmouth, New Hampshire-based Pax World Management is to be acquired by U.K.-based Impax Asset Management in a $90 million deal announced on Monday.

Together, the two companies said they will become a sustainable investment firm with over $13 billion in assets under management.

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A wind turbine stands on property used by the Iberdrola Renewables Holdings Inc. New Harvest Wind Power Project in Schleswig, Iowa, U.S., on Friday, Sept. 16, 2016. Wind energy, the fastest-growing source of electricity in the U.S., is transforming low-income rural areas in ways not seen since the federal government gave land to homesteaders 150 years ago. Photographer: Daniel Acker/Bloomberg

“We believe that combining our two firms will create a leading sustainable investment manager with business on both sides of the Atlantic,” said Pax CEO Joe Keefe in a statement.

There’s a real value in cornering sustainable investing, which is also referred to as socially responsible investing or environmental, social and governance investing.

Currently, the market for such investing is worth over $8 trillion in the U.S. alone, according to the US Forum for Sustainable and Responsible Investment.

And the future class of investors consistently ranks sustainable investing as their primary demand from providers. A Morgan Stanley survey, for instance, found that 84% said investing with a focus on sustainability as a top goal.

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The two firms are not strangers to one another, having partnered in 2007 to launch an environmental fund, which has over $500 million in assets.

“After a decade of successfully partnering to design, launch and manage the Pax Global Environmental Markets Fund, the Impax and Pax teams will be joining forces,” stated Impax Founder and Chief Executive Ian Simm.

The deal is the latest merger predicted for the asset management industry, which has struggled under greater regulation and falling revenues and fee compression.

The most recent mega-deal was a $14 billion merger between Standard Life and Aberdeen Asset Management, completed this past April.

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