DCC Energy, a major London Stock Exchange-listed energy business based in Dublin, has accepted a takeover offer from private equity groups KKR and Energy Capital Partners valued at £5.75bn. The company’s board recommended the proposal despite significant objections from key stakeholders.
The offer price stands at £65.25 per share in cash, supplemented by an additional £1.25 per share contingent on reaching certain price conditions for the sale of DCC’s technology division, Nexora. This base offer represents a 36% premium over the company’s average share price during the three months preceding public announcement of takeover discussions.
Founder Jim Flavin, who maintains a substantial shareholding, expressed strong criticism of the board’s decision, characterizing it as undervaluing the off-grid energy services provider. Flavin pointed to the company’s 2022 strategic update, which outlined plans to double operating profits to £830m by 2030, arguing the current offer does not reflect this growth trajectory. Major institutional investors Aviva and Fidelity, both holding significant positions in DCC, similarly opposed the transaction, with Aviva’s investment head stating the deal would produce a poor outcome for shareholders.
The proposed acquisition represents part of a broader trend of major businesses departing from UK equity markets through private equity transactions. Recent comparable takeovers have involved facility management company Mitie, food ingredients supplier Tate & Lyle, and gaming company Evoke. Low-cost airline easyJet is also subject to a potential offer of similar scale.
DCC’s board characterized the offer as a compelling and certain opportunity for shareholders to realize immediate cash value. Following the announcement, DCC shares rose marginally, closing just under 1% higher at £63.40.
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