Irish firm DCC Energy (LON:DCC) announced it had agreed a £5.75 billion takeover offer from US private equity investors. The cash offer amounts to £67.97 per share, including a final FY26 dividend, and could increase by up to 125p.
‘A compelling opportunity’
The US consortium comprises Energy Capital Partners, the infrastructure subsdiary of Bridgepoint (LON:BPT), and global investment firm KKR (NYSE:KKR). The headline offer represents a 24% premium to the price on 28 April, before the consortium made its first approach.
On top of the headline offer, shareholders could receive up to 125p per share in cash if Nexora is sold. Nexora is DCC’s technology business, which is already up for sale.
Mark Breuer, chair of DCC, commented: ‘Whilst the DCC Energy board remains confident in the energy strategy and associated 2030 Ambition announced in 2022, the Board believes the consortium’s offer represents a compelling opportunity for shareholders to crystallise value in cash at an attractive premium to DCC Energy’s historical trading price.’
Ryan Miller, KKR Infrastructure managing director, said DCC Energy was at a pivotal point in its strategy. ‘Delivering the next phase of this transition across a complex asset base will require significant operational transformation against the backdrop of a changing and volatile energy market’, added Miller.
DCC investors can finally breathe a sigh of relief and count their pennies after almost three months of haggling. There can’t be any complaint about the price, which is higher than the shares have ever traded in the past.
Both ECP and KKR have a long history of investing in energy assets and infrastructure. As a result they have substantial platforms and the expertise to help DCC become a global player.
Sadly, for the London Stock Exchange and UK investors, it’s another prized asset exiting the market. Without a substantial IPO pipeline to replace the growing list of bid targets, the pool of potential investments keeps getting smaller.
Interestingly, today’s deal isn’t the only one in the energy sector as Pharos Energy (LON:PHAR) has agreed a £146 million takeover by Serica Energy (LON:SQZ). Serica is paying 33.6p per share, including a 0.9p final FY25 dividend, which represents a 20% to the rival Ratio offer.
