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July 6, 2020

Morningstar closes purchase of ESG research firm Sustainalytics

Investment research firm Morningstar has wrapped up the acquisition of ESG ratings and research firm Sustainalytics.

The deal, which includes an initial payment of €55m in cash, was announced in April this year.

The transaction also includes further cash payments in 2021 and 2022 based on the revenues of the acquired business.

Morningstar initially picked a 40% interest in Sustainalytics in 2017.

The firm intends to support the current offerings of Sustainalytics.

It also aims to integrate ESG data and insights across research and solutions for different segments.

These segments are individual investors, advisers, private equity firms, asset managers and owners, plan sponsors, as well as credit issuers.

Morningstar has retained over 650 Sustainalytics employees along with its executive team.

Sustainalytics CEO Michael Jantzi said: “For more than 25 years, Sustainalytics has played a leadership role globally, influencing the way in which institutional asset managers and public pension funds integrate ESG into their investment decisions and, more recently, shaping the emerging sustainable finance market as the world’s largest second-party opinion provider for green and sustainable bond issuances.

“Coming together with Morningstar creates the scale to influence capital across the entire investment spectrum and make ESG a part of every investment consideration.”

Sustainalytics offers data on 40,000 firms along with ratings on 20,000 companies and 172 countries.

Morningstar CEO Kunal Kapoor said: “Together, we will lead investors of all types through this transition, empowering them with ESG insights that allow for the personalisation of portfolios across asset classes.”

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