FTSE 100 energy group DCC has agreed to a £5.75bn takeover by a consortium of private equity firms, adding to a growing wave of takeovers on the London Stock Exchange this year.

US private equity firm KKR and Energy Capital Partners, a subsidiary of London-listed Bridgepoint, said on Monday that they would pay a total of £65 per share in cash for the company, plus a final dividend of 147p per share.

The Dublin-headquartered company’s board had previously recommended the £5.7bn deal, but several top 10 investors pushed back, warning that the buyers were underpaying for the energy group. The agreed transaction represents a 24 per cent premium to DCC’s undisturbed share price before the offer period began, reflecting the sort of premium often central to takeover talks even as some shareholders question whether it captures the company’s longer-term value.

Founder ‘astonished’ by takeover

“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,” said Mark Breuer, chair of DCC Energy.

The deal could still face resistance when it is put to shareholders in September. Major investors including Aviva and Fidelity International had said the bid “significantly” undervalues the energy firm’s long-term prospects.

Jim Flavin, DCC’s retired founder and a top shareholder, said he was “astounded” by the board’s decision to recommend the private equity swoop.

“How a responsible board can put out an announcement which includes a dividend that was paid out last [week] is beyond me. Why would the board go along with such a charade? I regard this price as totally inadequate,” he said.

Dealmaking could reach £70bn

The DCC transaction is one of 11 deals worth more than £1bn this year on the London Stock Exchange, as private buyers target listed companies in London. The run of bids has become a notable feature of the market this year, with investors watching not just DCC but a broader set of UK-listed groups that have become takeover targets.

Mitie became the latest London-listed company to confirm its exit from the public market last week, after the facilities management group accepted a £3.1bn offer from private equity-backed rival OCS.

On Wednesday, FTSE 100 real estate group Segro said it was minded to accept a £14bn offer from US property rival Prologis.

According to AJ Bell, the deals already in progress would be worth more than £69bn if completed, making 2026 the highest-value year for takeovers of listed firms since the pandemic.

DCC shares rose 1.1 per cent on Monday to 6,355p.