DCC plc tender offer

Status
Not open for further replies.
We know now.


The Tender Offer closed at 1:00 p.m. on 17 December 2025 (the “Closing Date”). 11,605,415 Ordinary
Shares were successfully tendered and will be purchased today at £51.70 per share (the “Strike Price”). The number of Ordinary Shares being purchased represents approximately 12.0% of the current issued share capital of the Company (excluding treasury shares).

The Tender Offer was fully subscribed, with the aggregate value of Ordinary Shares validly tendered by Shareholders at a price below or at the Strike Price (or as Strike Price Tenders) exceeding £600 million. Therefore, in line with the scaling-down mechanism set out in the Circular, tenders have been
accepted as follows:
 

Attachments

  • 1766137109114.webp
    1766137109114.webp
    42.6 KB · Views: 55
One issue which none of us mentioned in the thread (?) was that by returning cash to shareholders, the market capitalisation of DCC would be reduced which has made it close to being kicked out of the FTSE 100.

www.irishtimes.com

DCC could trigger FTSE 100 exit if it perseveres with share buybacks from tech unit sale

Five FTSE 250 groups valued more highly by the market than Ireland’s last member of blue chip index
www.irishtimes.com www.irishtimes.com

When that happens to a company, although the underlying business of a company does not change, FTSE 100 trackers sell off the shares.
 
@Brendan Burgess you were correct in your assessment of what would happen after the buyout of the shares by dcc. However it doesn't make sense why such a sell off, the markets always over estimate the short term and under estimate the long term. But that is how you make money by taking advantage of that and waiting, look at Tesco a decade ago, Warren buffet got that wrong by not just waiting
 
joe sod said:
you were correct in your assessment of what would happen after the buyout of the shares by dcc.
Click to expand...

Thanks, but I was neither correct nor incorrect. The adjustment I calculated was too small to be noticed in the much bigger movements in share prices.
 
joe sod said:
However it doesn't make sense why such a sell off,
Click to expand...

Forced selling.

FTSE, STOXX (EU), MSCI Services focused ETFs and funds and some funds with ESG mandates we're forced to divest DCC into the new year. DCC by every metric is now an energy company where before it was a conglomerate or industry services group.....energy is now the majority of its EBITDA and so its industry classification by all the aforementioned groups has changed.

Indeed DCC mgmt I'm guessing understood this market structure dynamic and so timed the tender offer into year end knowing this very fact which helps explain the relatively small tender premium required to get away such a hefty buyback of stock....actively managed funds who could no longer hold DCC into 2026 used the tender as exit liquidity.....passive zombie funds well they just dumped the stock into year end and beginning of 2026 using some VWAP algo which drove the price down (you get what you pay for sometimes!!).

The reverse is likely to happen in March as FTSE UK Energy, STOXX Europe 600 Energy and MSCI Europe Energy will be forced buyers of the newly re-classified DCC Energy as a pure play energy company......of course everybody knows that and a plethora of arb hedge funds will begin or should I say have probably already begun to warehouse DCC stock at lower prices on their books to then sell to the index funds on the day they are forced to buy*

* lots of these funds are measured by tracking error to their chosen index.......and so they will execute a 'market on close' order for tens of millions of pounds of DCC Energy stock on the Friday before DCC's inclusion date.....on the other side of the trade will be the arb funds providing the liquidity, the same arb funds who warehoused DCC stock at much much lower prices in the weeks preceding the index inclusion.
 
ClubMan said:
What's ..... a ..... passive ..... zombie ..... fund ...... ?
Click to expand...

One.....with....... no fund manager at the top making timing, price, allocation or buying/selling decisions.....one....that simply seeks to perfectly mirror an index, an index created by MSCI or FTSE.....the index tells the fund in what proportion to own the stocks (mkt cap weighted or some funds chose to be equal weight) AND then at the fund level inflows and outflows into the fund drive wether that fund is a net buyer or seller of a secrutiy on any given.....its a zombie because as you can see there is no thinking going on here.....simply tracking of an index.
 
Status
Not open for further replies.
Back
Top