Inside the ICG buyout

Irish Continental Group runs Irish Ferries between Ireland, Britain and France, the Eucon container line between Ireland and the Continent, and the container terminals at Dublin and Belfast. It floated in 1988 and has been run by Eamonn Rothwell since 1992. In 2025 it earned €150.6m of EBITDA on €666.7m of revenue, bought back €97.7m of its own shares, and ended the year with net debt of €256.1m including leases.

On 24 July 2026 its independent directors recommended an €8.00 cash offer from Bluefin Bidco, a vehicle owned by Rothwell and three colleagues who together held 23.7% of the company. The board’s stated reason was the rating: a company of ICG’s size, it argued, is held back by the shift to passive investing and by active investors’ need for liquidity, and no third party had come forward in several years. The team’s reason was the same, with the added view that the fleet investment the business needs is easier to fund in private hands.

The offer is by scheme of arrangement, which needed 75% of the votes cast at a meeting of the shareholders being bought out. It got 79.2%, after an adjournment that the board said was needed because, on the proxies received by 26 August, it would have failed.

A management buyout is a conflict of interest managed by process. The people with the best information about the company are the buyers; the shareholders deciding whether to sell have the board’s recommendation, a fairness opinion and the price. So the question a reader should be able to answer from the documents is not whether €8.00 is right, which nobody outside the deal can know, but what the price and the financing imply: how much of the equity the team keeps, what the preferred investor is owed before the team sees anything, how much the business has to earn to carry €798m of senior debt, and what would have to be true for the dissenting shareholders’ view of value to hold.

The model on this page answers those questions as conditional scenarios. Where the documents give a figure it uses the figure and cites it. Where they do not, or where the published agreements black the number out (the Preferred Return, the profit share, the base rate under the banks’ disclosed margin, the sweep’s percentage, the fees, the operating plan, the exit), it uses a labelled assumption, and the controls below let you replace it. The Scheme Document of 5 August gives the senior facilities’ term and margin. The facilities agreement published with it gives the shape of the debt: a term loan repaid in one payment, a revolver, a sweep of excess cash flow and covenants on its own definitions. The Subscription Agreement says what the €455m buys, cumulative preference shares and Profit Share Securities beside them, and blacks out every rate.

Three numbers are routinely confused in the reporting of this deal and the model keeps them apart. Equity value is the fully diluted share count at the offer: 151.97m shares at €8.00, €1,216m. Enterprise value adds the debt the buyer inherits: €1,472m on the announcement’s basis (net debt at December 2025), and about €1,444m on the model’s (the June 2026 balance sheet it actually assumes). Neither is the funding requirement. The uses are cash to the shareholders who are selling, the refinancing of €215m of bank loans, costs, and whatever cash is left on the balance sheet; the €49.7m of leases are assumed, not paid. The refinancing is a disclosed use: the facilities agreement lets the term loan repay the debt under six named ICG facilities and close out their hedging (clause 3.1, p.100), so the old bank loans go at completion.

The team’s shares are worth €281m at the offer. It sells €90m of them for cash and rolls the remaining €191m into the acquisition vehicle, which is both a use (those shares are acquired) and a source (they are paid for in new equity rather than cash). Cash to shareholders is therefore equity value less the rollover: €1,025m, of which €90m goes to the team on the same terms as everyone else. The sources are €798m of senior debt, the €783m term loan (Facility B) and the €15m of the €75m revolver that may fund the deal on a certain funds basis, then the €455m of preferred, the €191m rollover and the company’s own €36.8m of cash. At the announced terms the arithmetic closes with about €20m of cash on the balance sheet after €30m of assumed costs, which is the sign that the disclosed amounts hang together. The banks have committed €858m in all: the other €60m of the revolver stays undrawn, for running the business.

After completion the capital stack is €798m of senior debt, €49.7m of leases, €455m of preferred equity and €191m of ordinary equity. The team owns the ordinary class outright on the documents’ description: ManagementCo is owned and controlled by the four of them, and the incentive arrangement for other senior managers is an option over their existing ICG shares at €8.00, not a slice of the new company. The announcement says its rollover is about 30% of the combined equity including the preferred, which the model reproduces at 29.6%; the preferred and the rollover together are 44.7% of equity plus senior debt at close, above the 40% the banks require before they lend. That 30% is a share of the capital, not of the proceeds. The preference shares are owed their subscription plus a cumulative Preferred Return before the ordinary receives anything, and the Profit Share Securities issued beside them then take a share of what is left, so the team’s share of an exit depends on how large that claim has grown, how much the profit share takes and how much the equity is worth when the time comes.

The announcement describes the result in its own words: the team will participate "through an investment in a highly leveraged private ownership structure with €798 million of senior debt above the equity base". The model puts numbers to that sentence under three cases.

The debt is sized against a business whose 2026 is weaker than its 2025. The half-year report shows revenue up 16% on cost recovery but EBITDA up only 7%, margins compressed by fuel, port charges and emissions costs, and a summer in which cars fell 7.9% and freight 9.3% against the prior year, with P&O serving notice on the Dover-Calais space charter. The base case therefore has 2026 EBITDA near 2025’s at about €151m, recovering margins over the hold to reach about €191m by 2031; the downside holds revenue flat and margins compressed, with EBITDA around €139m in 2031; the upside recovers faster. All three are editorial assumptions, and the controls let you write your own.

Against €798m of senior debt the base case opens at 5.3x senior leverage and 5.5x net debt including leases. The covenant in the facilities agreement measures it differently, leaving leases out of debt and taking lease payments out of EBITDA, and on that basis Net Debt Cover opens at 5.6x, against limits the published agreement blacks out. The Scheme Document gives the banks’ margin, 2.85% in the first year rising each anniversary to 3.40% in the fifth, set by time rather than by leverage, but not the base rate; at an illustrative 2% EURIBOR the first year costs 4.85% and EBITDA covers senior interest about 4.2 times. The term loan is repaid in one payment seven years after completion, so nothing is scheduled. Instead, each half-year a percentage of excess cash flow (what is left after leases, maintenance capex of about €27m a year, €30m of strategic capex, tax and interest), less €5m, must prepay it. The percentage is blacked out; the model uses 75%, and applies the cash the sweep leaves above a €20m minimum to prepay as well, which the agreement allows without penalty, so the base case does not turn on the hidden percentage. The term loan falls to about €438m by 2031 in the base case. In the downside it falls only to about €667m, and Net Debt Cover on the agreement’s definition is still above 5x at the end of the hold.

At a 9.5x exit at the end of 2031 the base case returns €1,344m of equity proceeds. The preference shares, accruing at the model’s illustrative 10%, have a claim of €733m and take it. The Profit Share Securities then take an illustrative 10% of the €611m left, €61m, so the preferred investor receives €794m, 1.74 times its €455m and an 11.8% IRR: the Preferred Return and what the profit share adds. Paying part of the return in cash would leave the preference shares earning their 10% and lower their multiple, because the cash arrives sooner, while the cash paid out slows the repayment of the senior debt. The ordinary takes the remaining €550m, 2.9 times the €191m rolled, a 23.5% IRR. Add the €90m the team took in cash and it has turned shares worth €281m at the offer into €640m over five years, undiscounted, if the plan is met.

In the downside the same structure leaves the ordinary with nothing. Equity proceeds of about €623m fall short of the €733m claim, so the preference shares take everything, the profit share nothing, and the preferred investor earns about 6.5%, and the rollover is worth nil. That is what "highly leveraged" means in practice: the team has bet the value of its rolled shares on a recovery, with a creditor-like investor ahead of it. The upside pays the ordinary 4.3 times, and the preferred investor more too, since its profit share grows with the equity.

The returns bridge shows where the base-case gain comes from: about €374m from EBITDA growth at the entry multiple, €360m from paying down debt, a small loss from exiting at 9.5x against a 9.5x entry, and €30m of costs. Of the €698m total, €278m goes to the preference shares as their accrued return and €61m to the profit share. Almost half the gain over five years goes to the investor that put up 70% of the equity, most of it as a fixed return whatever the business does and the rest as a share of the upside, which is the price of being able to buy the company without a sponsor.

Four institutional shareholders with about 10% between them were reported to oppose the price, and Oxy Capital, with 1.4%, wrote that the offer took the company private at a 39% discount, on the basis of comparable transactions it did not publish. The board and the bidder disagreed, ISS recommended acceptance, and the scheme passed with 79% of the votes cast. None of that settles what the company is worth, and the model does not try to.

What it can do is show what the claim would require. Read as a 39% discount to value, €8.00 implies a value of €13.11 a share, which at 2025 EBITDA and December-2025 net debt is 14.9 times EBITDA. Read as value 39% above the offer, it implies €11.12 and 12.9 times. Both readings sit well above where ICG had traded (the twelve-month average was €5.93) and above the 9.8 times the offer pays. Whether comparable ferry and port transactions support such multiples is exactly the evidence the letter did not publish, so the page states the claim, the two readings, and the multiples each needs, and leaves the judgement where it belongs. The model also shows the other side: at €11.12 a share the structure would need €364m of new equity, since the facilities agreement allows a higher price only if new investment pays for it, and in the base case the ordinary (the rollover and the new money together) would get back about 0.8 times what it put in, which is the practical reason a bidder financed this way could not simply pay it.

The offer price control re-runs the whole structure: a higher price raises the cash consideration, the rollover and, because the preferred and the facilities are fixed by the documents, the new equity the model raises to pay for it. The exit multiple, the Preferred Return and the profit share are the assumptions the returns rest on most; the first moves everything, the other two move the split between the two classes. The base rate under the disclosed margin and the strategic capex move the deleveraging. Switch the scenario and watch the ordinary’s bar in the waterfall; in the downside it is not there.

Sign in free to change any input in the full workbook below, or take the base, downside and upside cases as they are. The pictures, the figures in this text and the workbook read the same cells.