* Donal Murphy to succeed Tommy Breen as CEO from July
* To buy Shell's LPG business in Hong Kong and Macau
* To sell environment business to Exponent
(Adds news of sale, analyst comments, details, shares)
By Esha Vaish
April 5 Support services company DCC has
picked the head of its energy division, Donal Murphy, to succeed
retiring chief executive Tommy Breen from July, it said on
The company also announced plans to buy Shell's
liquid petroleum gas (LPG) business in Hong Kong and Macau for
HK$1.165 billion ($150 million) including debt, as part of a
drive to focus more on energy - its largest business.
With the same strategy in mind, it said it would sell its
environmental business to private equity firm Exponent for 219
million pounds ($274 million), including debt.
DCC, whose activities range from distributing oil to making
Body Shop's body butters, said it expected to receive about 170
million pounds in cash after that sale completes in the quarter
ending June 30.
"The disposal of the environmental division brings sharpened
strategic focus to the group and will allow DCC to concentrate
fully on growing and developing the Energy, Healthcare and
Technology divisions," Breen said in a statement.
DCC has been looking to buy distribution and market assets
from oil majors as they slim down to cope with weaker oil
prices, and said on Wednesday the Shell deal would give it one
of the leading LPG businesses in Hong Kong and the market leader
The operations will retain the Shell brand and the deal is
expected to complete before the end of DCC's financial year on
March 31, 2018.
Incoming CEO Murphy has led the energy business, which
accounts for about 68 percent of DCC's profit, for eleven years,
during which time the unit's profit has grown by more than 400
percent and it has expanded into 11 markets through about 125
acquisitions worth 1.4 billion pounds in total.
"Donal has led the very significant growth of the energy
division ... (He) is well known to, and regarded by investors
and his appointment should be well received," Peel Hunt analysts
wrote in a note.
DCC stuck by its November forecast for operating profit in
the year ended March 31, 2017, to be significantly ahead of the
previous year, thanks to past acquisitions and strong trading.
Davy analysts have forecast earnings before interest, tax,
depreciation and amortisation (EBITDA) of 360 million pounds.
DCC shares were up 1.8 percent at 7,145 pence at 1159 GMT,
the third biggest rise on London's bluechip index.
($1 = 0.8008 pounds)
($1 = 7.7687 Hong Kong dollars)
(Reporting by Esha Vaish in Bengaluru; Editing by Sunil Nair
and Mark Potter)