JPMorgan Buys Carbon Offsetting Company

JPMorgan Buys Carbon Offsetting Company

JPMorgan has acquired ClimateCare and plans to integrate the carbon offsetting company into its Environmental Markets group, the investment bank said Wednesday.

The group, which will continue operating under the JPMorgan and ClimateCare brand names, will invest in large-scale carbon emissions reduction projects and trade the resulting carbon reduction credits in the voluntary and compliance markets. The sale will close in the second quarter of 2008.

Other investment banks, such as Citigroup and Morgan Stanley, have recently bought stakes in developers of offset projects but it's the first time an investment bank has bought a developer outright, Reuters reported.

"Clients are seeking to reduce their emissions both due to regulations and out of social responsibility," said Blythe Masters, JPMorgan's head of commodities. "This transaction positions JPMorgan to offer the highest-quality advice and execution in emerging carbon emissions markets."

Financial details of the sale weren't disclosed. The moves comes within weeks of JPMorgan acquiring rival Bear Stearns amidst a sell-off frenzy. Pioneer Carbon, the project sourcing arm of United Kingdom-based ClimateCare, is included in the transaction.

JPMorgan was one of several banks that drafted and adopted the Carbon Principles, which were designed to address carbon-related risk in financing.