Banks target £4B in junk bonds and loans to finance DCC Energy buyout

A consortium of major banks is preparing to offload roughly £4 billion in high-yield bonds and infrastructure loans to investors, all to finance one of the largest leveraged buyouts in the energy sector this year. The debt package backs the take-private acquisition of DCC Energy Plc by private equity giants KKR and Energy Capital Partners. The deal values DCC Energy at approximately £5.75 billion, or around $7.7 billion, representing a 24% to 30%-plus premium over the company’s undisturbed share price before acquisition talks surfaced. How the financing is structured An interim bridge facility of £3.6 billion has been arranged by a banking group that includes Barclays, Goldman Sachs, and BNP Paribas. Bridge facilities are essentially short-term placeholder loans that banks extend to get a deal done, with the explicit plan to replace them later with permanent financing from capital markets. In this case, that permanent financing is expected to come from two buckets: high-yield bonds and loans marketed to infrastructure-focused investors. DCC Energy is an Irish-based energy distributor specializing in fuels and LPG that generated £15.4 billion in revenue and £634 million in adjusted ...