Monthly Archives: September 2025

Policy spotlight: the future of the UK food system

 

https://gkstrategy.com/wp-content/uploads/2025/09/GK-Strategy-Policy-Spotlight-Report-The-Future-of-the-UK-Food-System-September-2025.pdf

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GK Strategy – Policy Spotlight Report – The Future of the UK Food System

 

GK is delighted to share its first policy spotlight report on the food and agriculture sectors where geo-political, economic and health priorities increasingly collide.

From tackling obesity and diet-related ill-heath to food security and investor appetite for agri-tech innovation, the government’s policy agenda is ambitious. Our report explores:

 

  • The future of food and health: analysis of the government’s more interventionist stance on obesity, sugar reform and the development of a new national food strategy.
  • Innovation in agriculture: why agri-tech is now a priority in the UK’s industrial strategy and where the opportunities lie for businesses to partner with government.
  • Investor sentiment: how food, agriculture and natural capital are performing as asset classes and where private capital flow is likely to follow.
  • The view from the US: how the political and regulatory landscape in the US is evolving and how this might shape UK markets.

 

With the government eager to demonstrate delivery and progress towards much-needed economic growth, businesses and investors have a critical window of opportunity to shape policy and regulation. This policy spotlight report highlights where the engagement opportunities lie, how to align with government priorities, and how to mitigate regulatory and political risks while unlocking commercial growth.

To explore the findings of this report in more detail and what they mean for your organisations, please reach out to thea@gkstrategy.com.

Anchors aweigh: A way for private investors to play potential Fannie, Freddie IPOs

By Erin Caddell, Anchor Advisors in partnership with GK Strategy

President Donald Trump’s second White House term has sparked discussion that his Administration might return the two U.S. Government Sponsored Enterprises (GSEs) to full public ownership after more than 16 years under federal control following their bailouts in the depths of the 2008 financial crisis. In May, Trump said his Administration is giving “serious consideration” to conducting IPOs for the GSEs. And in late July Bloomberg reported that the Administration was holding meetings with bankers interested in underwriting the IPOs.

Fannie Mae and Freddie Mac’s vital place in the US mortgage system make them compelling assets for investors to look at should the IPOs move forward. Critical to the nation’s economy, the complexities of these entities and the market they serve present challenges necessitating a multi-year transition period to full private ownership. As Fannie and Freddie have swept billions of dollars in profit back to the government in the post-conservatorship era, both companies would need to build up their capital to stand as independent companies. The GSEs’ equity combined represent only 2% of their total assets, far less than traditional banks or mortgage finance firms.

This is where anchor investors could play a role. Anchor investors (we promise we do not like this idea just because we also have Anchor in our name) take meaningful equity stakes in companies preparing to go public, agreeing to hold the positions for a given period post-IPO as a sign of confidence for other investors and to lessen the fundraising need for the company. For instance, in the 2022 IPO of Life Insurance Corp. (LIC), India’s largest insurer, anchor investors including Norges Bank (Norway’s sovereign wealth fund) and the Government of Singapore (GIC) investment fund purchased about 25% of the issue in advance of the IPO. Sometimes anchor investors receive a discount on their shares in exchange for taking down large chunks of the IPO and agreeing to hold their shares though a post-IPO lockup period.

One can imagine the appeal to the government of anchor investors in the GSE IPO process, particularly for the Trump Administration, focused as it is on boosting investment in the US. For that matter, any future presidential administration will be attracted to the idea of contributing hundreds of billions to federal coffers in an attempt to offset multi-trillion-dollar federal budget deficits. Anchor investors could allow the government to generate income from early sales early, as the GSE transition plan and public offerings would likely take several years. A combination of domestic and foreign sovereign wealth funds would be most desirable: the domestic players to emphasize the US’ ability to invest in itself; the global investors to highlight the international attraction to the US capital markets. Expressing interest in the GSE privatizations now would give anchor investors a shot of having a seat at the table if the deals come together.

For investors, a day-one commitment to the GSE IPOs would provide a unique opportunity to invest in scale players in the $14 trillion US mortgage market – about 70% of which is supported in some way by Fannie or Freddie. The GSEs operate as critical components of the US mortgage industry infrastructure, setting standards and ensuring liquidity for residential and multi-family mortgage markets. Such “utility” functions have been rewarded with handsome valuation multiples and stock performance across financial services, energy, technology and other sectors, including those whose protective moats are protected by government regulation. Indeed, in the years leading up to the Global Financial Crisis, Fannie and Freddie performed well in the equity markets, though critics argued their accomplishments were driven by overly aggressive balance-sheet practices and lobbying activities.

Risks abound when investing in entities with multi-trillion-dollar balance sheets, as the wipeout of billions of dollars in the GSE’s market caps demonstrated in 2008. Numerous issues must be worked out to return the GSEs to private hands, most notably the current federal backstop on Fannie and Freddie’s combined $7 trillion-plus in debt, the lion’s share of which is backed by the mortgages the two entities guarantee. Even a modest increase in borrowing rates on such a large debt load could result in a big hit to the GSE’s earnings post-IPO, necessitating a long period in which the federal backstop is withdrawn over time.

But these are risks that large, sophisticated investors are well-equipped to navigate. A once-in-a- chance to invest in unique, highly profitable and protected franchises critical to the US economy, and to build goodwill with a President attracted to out-of-the-box deals, make the GSE privatizations an opportunity worth considering.

Why building 1.5 million homes isn’t as simple as it sounds….

Building 1.5 million new homes over the course of this parliament was a flagship policy commitment in Labour’s general election manifesto. The recently appointed housing secretary Steve Reed initially echoed the government’s ambition with the slogan ‘build baby build’. Reed has gone onto say the rate of construction is ‘unacceptable’ and has promised to increase the pace of housebuilding to deliver on Labour’s ambitious pre-election pledge.

The housing industry is facing a series of skills shortages. The Office for National Statistics warned that there are over 35,000 job vacancies in construction, many of which remain unfilled due to a lack of qualified workers. The Construction Industry Training Board (CITB) has stated that 61,000 new workers are needed each year to meet the government’s housebuilding target. Ministers have heard the calls of the CITB and in March announced that they would be investing up to £600 million to support training in the construction sector. This includes £165 million to help colleges deliver more construction courses and £40 million to support new foundation apprenticeships (launched in August). The £40 million includes an incentive of £2,000 per foundation apprentice hired and retained by employers which has been widely welcomed by the construction industry. The government has signalled that there could be continued investment, although this is likely to be restricted due to the current pressure on the public finances.

Another hurdle is the planning process. The number of new homes built in the UK has fallen during the government’s first year in office. Ministers have conceded there are ‘excessive rules’ delaying construction. The government is attempting to streamline the planning process through the Planning and Infrastructure Bill which is currently before parliament. Ministers claim that the bill will create a more decisive planning system and increase the amount of land available for developers. Whilst the bill is a step in the right direction, the impact is unlikely to be immediate.

Despite these barriers, there are some clear opportunities for the construction sector. Increases to training investment, new apprenticeships and the promise of reforms all signal the government’s continued prioritisation of the sector. The changing environment and the development of a potential second planning bill present stakeholders with a wide range of opportunities to engage with policymakers, shape regulation and improve relations between the government and sector.

Stuck in the middle with you? Ed Davey, the Lib Dem party conference and the moderate fight

GK Associate Director Thea Southwell Reeves and Adviser Mariella Turley share their reflections on the recent Lib Dem Party Conference in Bournemouth

The Lib Dem conference was a prime opportunity for the party to remind voters of who they are politically and what they offer. A combination of publicity stunts and clever campaign strategies sent 72 Lib Dem MPs to parliament at the last election – the party’s biggest electoral success for over a century. For leader Ed Davey, the challenge was to usher in a new, serious party that could offer a credible alternative to voters dissatisfied with the parties on the traditional left and right of British politics. If this was his mission, he may have missed the mark. His decision to march into conference as the head of a marching band while his party was having yet another row over trans rights, has not given much reassurance to potential voters (outside the conference hall walls) that the party represents a serious electoral alternative.

Although Davey remains in a strong position as leader with the support of a mostly happy party behind him, the public is growing weary of his endless stunts. Polling conducted by More in Common was presented to members at conference and showed that more than 60% of voters think the party’s publicity stunts make them look less serious. Many voters are also still unsure what the party stands for.

Much of the focus of the four-day conference was on positioning the Lib Dems as the only credible opposition to Reform UK. Former leader Tim Farron took to the stage adorned in the Union Jack flag in a bid to frame the party as a progressive voice that can reclaim patriotism for the centrist majority. Davey’s speech centred on criticism of Reform and included claims that Nigel Farage wants to liberalise UK gun laws. The slogan ‘don’t let Trump’s America become Farage’s Britain’ echoed throughout.

We did get a flavour of some policy. Party members voted to revise the Lib Dems’ 2045 net zero target to align with the government’s 2050 net zero goal. Duncan Brack, chair of the Lib Dems’ climate working group, accepted that the earlier deadline had become unrealistic thanks to previous government efforts. Deputy Leader Daisy Cooper used her speech to unveil plans for a windfall tax on big banks to fund an Energy Security Bank. The bank would offer loans to homeowners and small businesses to invest in insultation, solar power and heat pumps. However, Cooper was forced to admit that no formal conversations have taken place with any banks to date. The Lib Dem science and technology spokesperson Victoria Collins hinted at tighter social media regulation, proposing the introduction of warnings on addictive apps and a two-hour cap on scrolling for under 18s. Davey used his leader’s speech to outline some key policy objectives including a new customs union with the EU, cutting energy bills in half by 2050, a guarantee of starting urgent cancer treatment within two months of diagnosis for all patients, and discounted visas for US cancer researchers.

Those hoping that the party’s annual conference would provide clarity on the Lib Dems’ role in the British political ecosystem are likely to feel none the wiser. Davey’s closing speech pitches the party as a safe space for disgruntled voters on the left and the right. A place for both Labour voters who are frustrated with Starmer’s performance in his first year of government and Conservative voters who feel profoundly anxious about Badenoch’s drift to the right. Translating that into clear narratives around policy will be deeply challenging for the party and risks political incoherence. The party’s pitch to be the moderate voice of British politics requires considerable skill and acumen to sell to a voting public that is currently more attracted to polarising policies.

The fundamental question for conference was how the party can build on its 2024 electoral success. Instead of publicity stunts for media attention, Davey should put his energy into carving out a distinct message to voters. The party has neither the finances nor the political capital to campaign on all issues so they would be wiser to focus on developing appealing centrist policies such as ambitious integration with the EU, a compassionate approach to immigrants and a more socially liberal attitude to equal rights. These are the big-ticket items most likely to appeal to both the former one nation Tories and the liberal left and help the Lib Dems seize the centre ground.

GK Strategy Formally Expands Political Advisory Services to United States

GK has agreed a formal strategic partnership with Washington DC based Anchor Advisors to provide integrated insights for private equity investors navigating transatlantic M&A transactions.

GK Strategy is delighted to announce its formal expansion to the United States, to support its private-asset investor clients navigate and engage with policymaking at a federal and state level.

The partnership brings together GK Strategy’s deep expertise in the UK’s policy and regulatory environment with Anchor Advisors’ experience of supporting private equity investors navigate US policy at a state and federal level. The two firms will support private equity and private credit clients and their portfolio companies by providing robust insight to better anticipate regulatory change, assess political risk, and identify opportunities in both markets.

Louise Allen, CEO of GK Strategy said: “We’re delighted to announce the formal partnership between GK Strategy and Anchor Advisors. Private-asset investments are increasingly being shaped by fast-moving policy developments which have the potential to have significant impacts on the commercial environments for businesses operating in both the UK and the US.

Private equity and private credit firms, and the companies they own, are also increasingly looking beyond their traditional geographies to identify compelling investment opportunities, and to limit their exposure to any single region. GK’s partnership with Anchor Advisors means we can offer our clients a clear, connected perspective on how regulatory shifts in London and Washington could impact valuations, deal structures, and long-term strategies.”

Erin Caddell, President of Anchor Advisors, added: “Investors want certainty and foresight. Our partnership allows us to deliver precisely that, by providing clients with comprehensive analysis that spans both sides of the Atlantic, from opportunities presented by US federal and state government action to sector-specific funding trends.”

The partnership reflects a growing demand from private equity and private credit investors for tailored political and regulatory intelligence. By combining local insight with international perspective, GK Strategy and Anchor Advisors will support investors not only to mitigate risk but also to identify new growth opportunities in an increasingly complex global policy environment.

The new international advisory service will be led by Lizzie Wills, Senior Partner and Head of Private Equity at GK Strategy, and President of Anchor Advisors Erin Caddell.

For more information about GK’s US coverage, or to arrange an introductory meeting with the GK team in Washington D.C, please be in touch with Lizzie Wills on lizzie.wills@gkstrategy.com or 07456 794 568.