Europe’s largest pension fund, ABP of the Netherlands, sold its equity interest in Caterpillar (NYSE:CAT) following criticism over the company’s equipment being linked to Israel’s military operations in Gaza, Bloomberg News reported Wednesday.
ABP confirmed it no longer holds Caterpillar (NYSE:CAT) shares but still owns some of the company’s bonds as of June 30. Dutch media previously reported the fund’s Caterpillar stock was worth about €387 million ($455 million).
In a statement, the €520 billion fund said it could not ignore the concerns raised by members over the conflict in Gaza. While Caterpillar (CAT) was not named directly, ABP outlined its approach to investments in regions affected by war, saying it expects companies to comply with national and international laws. If engagement fails to bring change, the fund said it divests.
ABP serves about 3 million Dutch citizens and has been tightening its environmental, social and governance standards. It said it is now focusing on applying these policies to other asset classes, noting that its portfolio composition is shifting in response to conflicts such as Israel-Gaza.
The Dutch fund is the second major European investor to distance itself from Caterpillar (CAT). In August, Norway’s $2 trillion sovereign wealth fund said it would not invest in the company, citing its bulldozers’ role in demolitions in Gaza and the West Bank.
Despite the controversy, Caterpillar (CAT) shares closed September at a record high, supported by investor optimism that rising demand for electricity from artificial intelligence will boost sales of its power-generation turbines.
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