SHARES IN industrial holding group DCC rose yesterday after the company announced that it had completed its €22.7 million acquisition of Swedish fuel distributor Swea Energi.
Swea Energi, based near Gothenburg, distributes heating oils and transport fuels to domestic, commercial and industrial customers in Sweden.
In December, DCC said it would pay €22.7 million up front in cash for the business, with a further €6.6 million to be paid depending on the performance of the group in the 12 months to the end of March 2013. If the earn-out clause kicks in, it will bring the final cost of the deal to €29.3 million.
DCC gained 1.57 per cent to close at €19.35 in Dublin yesterday. Early in the day, its stock was quoted at €19.42, a 1.7 per cent increase on its opening quote.
Davy analyst Caren Crowley described the purchase as important for DCC, as it is seeking to expand its energy business beyond its core market, Britain, where it has a 16 per cent share of the fuels distribution market.
The energy business is the group’s biggest division. It generated earnings before interest and tax of €137 million in 2010. The mild winter is likely to hit 2011 earnings, which DCC expects to be €75 million to €90 million.
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