KKR exits Australia's GreenCollar to OTPP
Ontario Teachers’ Pension Plan (OTPP) will take full ownership of GreenCollar, an environmental services provider that helped establish Australia’s carbon credit market. This will facilitate an exit for KKR and other unnamed shareholders.
KKR invested a reported AUD 100m (USD 71m) in GreenCollar in 2020 via its global impact fund, which closed earlier that year at USD 1.3bn. The company – a certified B corporation and provider of environmental initiatives that reduce the impact of climate change – contributes to UN sustainable development goals (SDGs) relating to climate action, land preservation, and marine conservation.
OTPP made an investment of undisclosed size in 2022, taking a significant minority stake. The pension plan was expected to help GreenCollar launch plastics recovery projects in West Africa and the Pacific, as well as a cookstoves project in Southern Africa and a forest protection project in Southeast Asia.
Founded by James Schultz, the company is the largest operator in Australia’s carbon credit space. It is best known for helping landowners develop carbon storage projects on farms, then helping sell the resulting carbon credits to private and public organizations seeking to manage their environmental impact. The concept has been expanded from carbon to water quality, biodiversity, and plastics markets.
During KKR’s investment period, GreenCollar acquired carbon advisory and trading firm Sigma Global, carbon farming business Devine Agribusiness Carbon, and consumer-facing offsets platform Go Neutral. Other partnerships focused on biodiversity, reduction in plastics waste, and a credits programme linked to water quality in Australia’s Great Barrier Reef.
KKR also included GreenCollar in its employee ownership and engagement initiative, whereby non-senior executives at portfolio companies are awarded equity. This is structured as an incremental benefit, not a substitute for benefits, wages, or wage increases.
“We are pleased to increase our investment in GreenCollar and to continue supporting James and his team in their mission to restore and enhance natural capital in areas like biodiversity and water quality,” said Christopher Metrakos, a senior manager for natural resources at OTPP, in a statement.
“GreenCollar is a proven leader in delivering positive environmental outcomes with market-based solutions and we are excited to continue supporting the company in its next chapter of growth in Australia and beyond.”
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