DCC, a major energy firm listed on the London Stock Exchange, has agreed to a takeover by US private equity groups KKR and Energy Capital Partners for £5.75bn. The Dublin-based company’s board has recommended the offer, which values the business at £65.25 per share in cash, along with an additional £1.25 per share contingent on the sale of its technology division, Nexora, reaching certain conditions.
The board characterized the offer as “a compelling and certain opportunity” for shareholders to realize value. The cash bid represents a 36% premium to the company’s average share price during the three-month period before takeover discussions became public. However, the transaction has attracted significant opposition from key stakeholders, including DCC’s founder Jim Flavin, who holds a substantial shareholding.
Flavin expressed strong objection to the board’s recommendation, stating he was “astounded” by their decision and characterizing the offer as “totally inadequate.” He referenced the company’s 2022 strategic update, which outlined an objective to double operating profits to £830m by 2030, suggesting the current valuation does not reflect the company’s growth potential. Major institutional investors, including pension company Aviva and asset manager Fidelity, have also indicated they will not support the transaction, with Aviva Investors describing it as “a bad outcome for shareholders.”
The proposed acquisition is part of a broader trend of London-listed companies being taken private by private equity investors in recent months. Other recent transactions in this space include the acquisitions of Mitie, Tate & Lyle, and Evoke, while budget airline easyJet is currently subject to a potential takeover offer valuing it at £5.7bn. Following the announcement, DCC shares moved modestly higher, closing just under 1% up at £63.40.
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