Valuations of renewable assets are volatile, and exits remain hard. At least one investor thinks the banking giant should get itself out of the business.
Already a subscriber?Despite well-flagged expectations of weaker earnings growth, and the departure of one of its most senior executives, Macquarie’s share price remains surprisingly strong.
But it’s the green investments and funds that really split the market. Macquarie told investors last year that, among other things, its earnings will be hit by “lower asset realisations in green investments and continued investment in the development of green energy portfolio companies in Macquarie Asset Management”.
Unnerving these investors even more are reports that Macquarie has been slow to write down the valuations of others holding and causing tension with joint investors, includingMany investments in green infrastructure have also been accelerated because of government subsidies.
But some say that may not come. Leithner is questioning the merit of investing in green assets, arguing that the investment case for green energy investments has not been proved. For many, the combination of Macquarie’s track record of identifying long-term trends and the small exposure to the green energy sector means that can be pushed to one side.Those bullish on Macquarie, including MST’s Johnson, note shares have underperformed global specialist asset manager peers who rallied before expected interest rate falls.
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