Grand Canal Capital Partners Grand Canal Capital Partners
Prepared for
ESB
23 · 05 · 2026
Briefing · For ESB Group

A new long-dated, fixed-rate source of capital.

This document sets out the recent Prudential Regulation Authority reform that has unlocked UK Bulk Purchase Annuity insurer capital, a £2 trillion market, for direct lending to investment-grade regulated utilities — the structural picture, the appetite, and where it intersects with ESB's published debt programme.
UniverseUK BPA panel · ~£300bn Matching Adjustment ("MA") AUM · ~£2trn total
Tenorfrom 10 years to 55 years
Potential scale€200m – €1bn+
CounterpartyGrand Canal Capital Partners · Dublin & Song Capital · London
§ 1 · The capital

Where the capital comes from.

Our partner, Song Capital, is a UK-based long-tenor debt platform deploying capital sourced exclusively from the United Kingdom's Bulk Purchase Annuity insurer panel. The active panel comprises seven PRA-regulated UK life insurers. Cumulative Song Capital deployment in the past 36 months is approximately £4 billion.

— 01

How the funders work.

A Bulk Purchase Annuity is a contract under which a UK life insurer assumes the defined-benefit pension liabilities of a sponsoring corporate in return for an upfront premium. The insurer then pays those pensions for life, backed by an asset portfolio that, under Solvency UK, attracts a Matching Adjustment uplift in discount rate where assets are sufficiently long-dated, predictable, and investment-grade. This enables the life insurer to hold a materially smaller amount of capital against the pension liabilities than would previously have been the case.

Regulated electricity transmission and distribution under a published price-control framework — ESB Networks under CRU PR6, NIE Networks under UR RP7 — sits in the highest tier of MA-eligible asset under the revised PRA rules.

— 02

The panel, at scale — and where it is heading.

Combined life-insurance AUM across the active panel is approximately £2 trillion, of which the Matching-Adjustment portfolios that back BPA business are approximately £300 billion and growing. Annual UK BPA volume reached a record £38.2bn in 2025; industry forecasts point to £50bn or more in 2026.

Song Capital has deployed ~£4 billion to date, with a stated target of ~£7 billion over the next twelve months. Single-ticket volume to date has been £200m–£1.25bn.

— 03

What this means for ESB.

The panel does not replace ESB's Euro Medium Term Note Programme. It complements it — sitting alongside the public bond curve in the tranches where the public market either does not reach (25-year-plus, beyond the EMTN ceiling) or where private execution offers structural advantage (covenant-light senior, no roadshow, single-counterparty execution).

The June 2026 £400m NIE Finance maturity and the June 2027 €500m ESB Finance DAC maturity sit directly inside the peak window of the PRA-engineered substitution dynamic described in § 2.

The capital, at a glance
UK BPA annual flow
£50bn+
2026 forecast · 2025 actual £38.2bn / 367 deals
Panel MA portfolio AUM
~£300bn
~£2 trillion total panel life-insurance AUM
Tenor available · fixed senior
10 to 55 years and below
10 to 55 years
EUR pricing anchor · 10yr
5.10%
€702.5m senior secured · German healthcare RE · Jun 2025
§ 2 · Why now

The PRA reform that opened the door.

PS17/25 (live since October 2025) made it possible, for the first time, to commit BPA insurer capital to a regulated utility issuer at 10- to 55-year fixed tenor without requiring an 18-month PRA rating approval window.

Live
Policy Statement 17/25

The Matching Adjustment Investment Accelerator.

Effective 27 October 2025

UK BPA insurers may now self-assess MA eligibility on novel asset structures and claim the MA benefit day one, regularising the assessment with the PRA over 24 months. The historical PRA approval pathway typically ran 18 months or longer — that obstacle is gone.

As a result, PRA incremental MA capacity is estimated to be approximately £10 billion in the first cycle.

For ESB: a bilateral Senior Term Loan can be added to a BPA insurer's MA portfolio without the historical 18-month gate.
ESB is, in substance, the textbook substitute asset the PRA describes. 97.7% Irish-State owned. S&P A+ (March 2026 upgrade). Two regulated electricity distribution monopolies under published price-control frameworks. Asset lives 30–50 years. This offers ESB the potential to source competitive long-dated funding.
§ 3 · ESB's published debt calendar

Where this capital intersects with the ESB maturity wall.

Every BPA structuring opportunity inside ESB Group sits against a published maturity catalyst. The table below restates the ESB Group public debt programme as disclosed on the ESB investor relations debt-information page, cross-checked against the ESB Finance DAC EMTN programme documentation and the NIE Finance plc supplementary prospectus dated 16 January 2026. The right-hand column carries GCCP's structuring interpretation — distinguished from primary facts by inline evidence tags.

Issuer · ISIN Ccy Coupon Amount outstanding Maturity GCCP structuring note
NIE Finance plc · XS0633547087 GBP 6.375% £400m 2 Jun 2026 NIE placed a £600m 5.875% Sep 2041 bond in January 2026 (XS3285511104), providing long-dated funding headroom around the June 2026 maturity. GCCP infers no incremental financing need at this point Estimated.
ESB Finance DAC · XS1239586594 EUR 2.125% €500m Jun 2027 Within BPA panel appetite at long-dated fixed format Estimated.
ESB Finance DAC · XS2697983869 EUR 4.00% €500m Oct 2028 Within BPA panel appetite at long-dated fixed format Estimated.
ESB Finance DAC · XS1560853670 EUR 1.750% €500m Feb 2029 Within BPA panel appetite at long-dated fixed format Estimated.
ESB Finance DAC · XS2009861480 EUR 1.125% €700m outstanding Jun 2030 €700m amount outstanding per ESB disclosure as at 31 Dec 2025. Largest single EUR maturity in the published stack; 30-year asset life within panel's long-tenor appetite Estimated.
NIE Finance plc · XS3063879525 GBP 5.750% £350m May 2035 Issued 2 May 2025 under the expanded £2.5bn EMTN programme. Second NIE GBP drawdown under the new programme; long-dated benchmark for BPA take-out Estimated.
NIE Finance plc · XS2528656080 GBP 5.875% £350m Dec 2032 Pre-programme-expansion benchmark. Public-market template for sterling BPA take-out at 10-year tenor Estimated.
NIE Finance plc · XS3285511104 GBP 5.875% £600m Sep 2041 Issued 30 Jan 2026 under the £2.5bn EMTN programme. Public-market template; complementary issuance executable as bilateral PP under the existing programme Estimated.
Sources
1 · esb.ie/investors/debt-information
2 · investegate.co.uk/announcement/prn/nie-finance-plc--46rt/annual-financial-report/9495831
3 · investegate.co.uk/announcement/prn/nie-finance-plc--46rt/publication-of-a-supplementary-prospectus/9359525
4 · NIE Finance plc Offering Circular 17 April 2025 — £2,500,000,000 EMTN Programme
5 · NIE Finance plc Final Terms 2 May 2025 — XS3063879525 £350m 5.750% 2035
6 · NIE Finance plc Final Terms 30 Jan 2026 — XS3285511104 £600m 5.875% 2041
§ 4 · Track record

Reference transactions in the asset class — panel-led precedents.

Six selected transactions from the panel and its principal arranger's deployment record, chosen to be analogous to ESB's profile across regulated infrastructure, healthcare, and digital infrastructure. Cumulative panel deployment to date is approximately £4 billion, with a stated target of ~£7 billion over the next twelve months.

Borrower / asset Sector Size Tenor & rate Year Relevance to ESB
Praemia REIM · MEDIAN (Germany) Healthcare RE €702.5m 10yr · 5.10% fixed Jun 2025 Bullseye EUR pricing reference at €700m+ scale
HARP / Haweswater · United Utilities UK water infra £3bn pkg 30–50yr DPC 2025 Multi-insurer state-backed utility — most directly analogous to NIE / ESB Networks
Sizewell C RAB (EDF) UK nuclear infra £5bn 35–60yr RAB Nov 2025 Demonstrates 35+ year long-tenor BPA appetite for regulated infrastructure
Northern Powergrid · XS2461236759 UK regulated distribution £350m 30yr · 3.25% to 2052 2022 Direct structural template for NIE Networks bilateral PP
L&G Digital Infrastructure Fund Digital infra · RNF wrap €600m Long-term Sep 2025 Closest UK-insurer Rated Note Feeder precedent; structural template if RNF format adopted
~£4bn
deployed to date
Cumulative · ramping to ~£7bn target over the next twelve months
£750m
single-ticket capacity
Documented · with appetite to £1.25bn
Bilateral
single-counterparty
Single execution counterparty · covenant-light senior
£2trn
combined panel AUM
~£300bn of which is dedicated MA portfolio
Contact

Grand Canal Capital Partners.

We have identified approximately €1.83–€3.4bn of financing that the BPA insurer market can source for ESB. We would very much welcome the opportunity to discuss this capital-sourcing opportunity with you further.

Aaron Sherlock
Partner
Jonathan Hillyer
Partner
Christopher Belton
Partner
Dave Murray
Partner
IssuerGrand Canal Capital Partners · Dublin, Ireland
AudienceESB Group
ConfidentialityConfidential · for internal ESB review only
Grand Canal Capital Partners
— Grand Canal Capital Partners · 23 May 2026 · Confidential —