KKR and Energy Capital Partners (ECP) have obtained a £3.6 billion bridge loan to help fund their £5.7 billion acquisition of DCC Energy. This bridge financing is intended to be replaced with approximately £2 billion in junk bonds and £1.6 billion in infrastructure loans, with banks including Bank of America, Barclays, Citigroup, Goldman Sachs, JP Morgan, Mizuho, Natixis, RBC, Royal Bank of Scotland, SMBC, and Wells Fargo reportedly working on the refinancing package. This financing strategy indicates a preference for diversified debt instruments to support the significant private equity buyout.
The acquisition, valued at more than £5.7 billion ($7.6 billion), received approval from 78.1% of DCC Energy shareholders at an extraordinary general meeting on September 18, 2026. The transaction is anticipated to be finalized in the first quarter of 2027. The deal includes a base consideration of 6,525 pence per share and a previously paid final dividend of 147.22 pence, bringing the total headline value for the share capital to approximately £5.75 billion. An additional contingent consideration of up to 125 pence per share is possible, tied to the disposal of DCC Energy's remaining technology business, Nexora, potentially increasing the maximum payout to 6,797.22 pence.
Fitch Ratings has placed DCC's 'BBB' issuer and senior unsecured debt ratings on Rating Watch Negative due to concerns that the acquisition will lead to a weaker credit profile and increased leverage under the new ownership. Fitch expects DCC's debt to rise above £1.9 billion by the end of March 2026, with EBITDA gross leverage at 2.7x, which is within the agency's 2.0x to 3.0x thresholds for its current rating. Bondholders have a redemption option for their €500 million public bonds and £1.4 billion U.S. private placements if a change of control results in a downgrade below investment grade or a rating withdrawal. The bridge facility itself can fund the acquisition, refinance existing debt, and support general corporate purposes, though the ultimate capital structure remains under review.
The DCC Energy board unanimously recommended the acquisition, considering it fair and reasonable for shareholders, and directors committed to voting in favor for their 0.28% holding. DCC Energy, headquartered in Dublin and listed on the London Stock Exchange, reported revenues of £15.4 billion and an adjusted operating profit of £634.0 million for the financial year ended March 31, 2026. The company specializes in multi-energy sales and distribution across Europe and the US, serving commercial, industrial, public, and domestic sectors.
