Shares in Downing Renewables & Infrastructure Trust PLC (LSE:DORE) jumped 22% after Bagnall Energy announced a £175 million cash takeover offer. The deal values each share at 102.6 pence, representing a 24% premium to the trust’s recent share price but about 7.5% below its net asset value (NAV) as of 31 March 2025.
Bagnall, which already owns 25.4% of the trust, is seeking full control, with backing from shareholders representing another 22.5% of shares. Analysts at Stifel see the bid as a logical move given the trust’s relatively small size and Bagnall’s growing stake, acquired amid a weak share price earlier this year.
While the offer is below NAV, Stifel points out that renewables investment trusts have recently traded at deep discounts—often 30% to 35%—due to risks like power price swings, high debt levels, subsidy expirations, and volatile dividend coverage. With strong shareholder support, it’s unlikely another bidder will emerge.
The deal will proceed through a court-approved scheme of arrangement and is recommended by Downing’s board. Stifel describes the acquisition as a sensible consolidation of a smaller fund and expects the shares to trade near 100 pence in the short term.
The shares shot up 18.5p to 101.5p.