WASHINGTON (dpa-AFX) - An index and analytics provider, MSCI Inc. (MSCI), announced on Wednesday that it has bought First Street to add property-level climate risk data to its investment tools.
The transaction consideration includes a cash payment of $120 million at closing, with potential additional payments during the first two years if certain revenue targets are met, MSCI said.
First Street provides physics-based models that assess climate hazards for individual buildings. The models use building characteristics, infrastructure and site-level data to estimate current and future physical risk, asset damage and business interruption.
MSCI said the deal will let clients measure physical climate risk at any geographic coordinate across more than 2 billion structures worldwide. The data will be integrated into MSCI's climate and geospatial products.
Demand for physical climate risk data has grown as extreme weather increases, MSCI said, citing First Street research that companies were 6.5 times more likely to issue profit warnings after extreme weather events in the past two decades.
Financial institutions, insurers and asset owners are using location-based risk analysis to meet reporting requirements and manage portfolios. Major European central banks use MSCI data to identify climate risks in loan books.
The deal is expected to close in third quarter 2026. First Street results will be reported under MSCI's Sustainability and Climate segment after closing, the company said in a statement.
On NYSE, shares of MSCI closed Tuesday's trading 0.11 percent higher at $581.51.
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