Grand Canal Capital Partners Grand Canal Capital Partners
Prepared for
ESB
Confidential · 20 · 05 · 2026
Briefing · For ESB Group Treasury

A new long-dated, fixed-rate source of capital. Built for the 2027–2030 calendar.

Two PRA reform packages — six months apart — have re-priced UK Bulk Purchase Annuity insurer capital toward 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 MA AUM · ~£2trn total
Tenor25–30yr fixed senior · 30–55yr outer envelope
ESB perimeterSix facilities · €1.83–€3.40bn · 2026–2030
CounterpartyGrand Canal Capital Partners · Dublin
§ 1 · The capital

Who SONG Capital is — and where the money comes from.

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 — Pension Insurance Corporation, Legal & General, Aviva, Phoenix / Standard Life, Just Group, Rothesay and Canada Life UK — supplemented by Royal London as a recent entrant and USS as a co-lender on selective tickets. Cumulative SONG deployment to date is approximately £4 billion; the platform is targeting £7 billion over the next twelve months.

— 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.

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 has deployed ~£4 billion to date, with a stated target of ~£7 billion over the next twelve months. Single-ticket capacity is documented to £750m–£1.25bn; a £750m UK hospitals deal closed late 2025 returned approximately £1.4bn of demand in one week — illustrative of depth.

— 03

What this means for ESB.

The panel does not replace ESB's EMTN 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 2027 €500m ESB Finance DAC maturity and the January 2027 €500m NIE Finance 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
25–30yr
30–55yr outer envelope where asset life supports
EUR pricing anchor · 10yr
5.10%
€702.5m senior secured · German healthcare RE · Jun 2025
§ 2 · Why now

Two PRA reforms, six months apart.

PS17/25 (live since October 2025) made it possible, for the first time, to commit BPA insurer capital to a regulated utility issuer at 25- to 30-year fixed tenor without an 18-month PRA approval gating window. CP8/26 (consultation closes 31 July 2026) engineers a regulatory tailwind into direct UK real-economy investment by raising the cost of the offshore funded-reinsurance alternative.

Live
Policy Statement 17/25

The Matching Adjustment Investment Accelerator — and Rated Note Feeders.

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 gate is gone.

The asset-exclusion list proposed in draft was dropped from the final policy statement: private credit and Rated Note Feeder structures are explicitly in MAIA scope. PRA-estimated incremental MA capacity ~£10bn in first cycle.

For ESB: bilateral Senior Term Loan to an investment-grade utility can be added to a BPA insurer's MA portfolio without an 18-month gate. RNF wrapping (Irish ICAV is the natural domicile) compresses insurer SCR on the position to ~9–15% versus ~49% on direct equity — translating to approximately 15–25 basis points of spread compression for ESB. On a £500m / 25-year facility, that is in the order of £15–30m of present-value saving over the life of the instrument.
Consultation
Consultation Paper 8/26

The Funded Reinsurance counterparty default reset — substitution into UK real economy.

Consultation closes 31 Jul 2026 · New business 1 Oct 2026 · Calc rule 1 Jul 2027

Raises the counterparty default adjustment UK insurers must apply when reinsuring annuity liabilities offshore — predominantly to Bermuda — from 2–4% to approximately 10%. The PRA has named the preferred substitute: direct UK real-economy investment — infrastructure senior term, ground debt, and private investment-grade corporate credit.

The intent across the consultation paper, the Truran speech of 29 April 2026, and the supporting policy briefings is explicit: re-route UK BPA insurer capital toward exactly the asset class ESB represents.

For ESB: the substitution dynamic binds progressively through Q4 2026 into 2027 — directly across the January 2027 NIE Finance EUR EMTN maturity and the 8 June 2027 €500m ESB Finance DAC maturity. Demand for the ESB profile strengthens through that window. The asymmetry is now; the calendar is set.
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. The structural-advantage case is the conjunction of the two reform windows arriving with ESB's 2027–2030 maturity calendar.
§ 3 · ESB's published debt calendar

Where this capital intersects with the maturity wall.

Every BPA structuring opportunity inside ESB Group sits against a published maturity catalyst. The table below quotes the ESB Group public debt programme directly from the 2025 Annual Report, the October 2024 EMTN Offering Circular, and the NIE Finance plc supplementary prospectus of 16 January 2026. The right-hand column is the GCCP structuring view at each point.

Issuer · ISIN Ccy Coupon Size Maturity GCCP structuring view
NIE Finance plc · XS0633547087 GBP 6.375% £400m 2 Jun 2026 Pre-funded via £600m 5.875% 2041 issued 30 Jan 2026. Closed catalyst.
NIE Finance plc · EUR EMTN EUR — €500m Jan 2027 20-month catalyst. Bilateral 25–30yr GBP-equivalent Senior Term Loan at panel pricing extends tenor beyond the public EMTN ceiling.
ESB Finance DAC · XS1239586594 EUR 2.125% €500m 8 Jun 2027 Natural opening transaction. 25–30yr fixed EUR Senior Term Loan or RNF wrap. Sits inside the CP8/26 substitution-dynamic peak.
ESB Finance DAC · XS2697983869 EUR 4.00% €500m 3 Oct 2028 Programmatic — second-stage tranche under the same panel relationship.
ESB Finance DAC · XS1560853670 EUR 1.750% €500m 7 Feb 2029 Refi at materially higher rates; the 25–30yr tenor argues for private placement format.
ESB Finance DAC · XS2009861480 EUR 1.125% €700m 11 Jun 2030 Largest single EUR maturity. 30-year asset life supports the longer-tenor end of panel appetite.
NIE Finance plc · XS3285511104 GBP 5.875% £600m 30 Jan 2041 Public template; complementary RP7 incremental issuance executable as bilateral PP under the existing programme.
Source · ESB Annual Report 2025 · ESB EMTN Offering Circular Oct 2024 · NIE Finance plc supplementary prospectus 16 Jan 2026. ISINs verified · Euronext + LSE programme registers.
§ 4 · The structuring opportunity set

Six facilities across the Group — €1.83–€3.40bn cumulative.

GCCP's view of the BPA-addressable opportunity set inside ESB Group, sized and tenored against the panel's documented capacity. The product across all six is Senior Term Loan or bilateral Private Placement — not Ground Debt. Regulated networks and depreciating generation plant do not generate the freehold rent-stream architecture Ground Debt requires.

# Facility Envelope Tenor Format Lead catalyst
01 NIE Networks RIIO / RP7 funding pipeline £1.6–2.0bn (€1.9–2.4bn) 15–30yr GBP Senior Term / Bilateral PP UR RP7 FD 30 Oct 2024 + Jan 2027 EUR EMTN
02 ESB Networks PR6 incremental capex €1.2–1.6bn 20–30yr EUR Senior Term @ ESB Finance DAC CRU PR6 FD 18 Dec 2025 + 8 Jun 2027 €500m
03 ESB Generation Wind · onshore refi + NnG partial €600–900m 18–25yr EUR Senior Term @ project SPV NnG operational; onshore refi window 2026–2028
04 ESB Solar + BESS · BnM JV €300–500m 10–25yr EUR Senior Term @ SPV CRU LDES framework expected 2026
05 Bord Gáis Energy refi · indirect via Centrica €250–400m 12–25yr Senior Term · Galway OCGT or Centrica plc Galway 334MW OCGT FID early 2027
06 ESB International Networks · JV stakes €150–250m 15–25yr Senior Term @ JV SPV Per-asset; monitor stage
Combined envelope €1.83–€3.40bn Senior Term Loan or bilateral Private Placement across all six. — not ground debt
§ 5 · Tenor & pricing

Against ESB's current toolkit — where the panel materially adds value.

The panel does not undercut the public EUR or GBP markets on short-tenor benchmark issuance. The panel adds tenor and structure ESB cannot otherwise access at scale — 25- to 30-year fixed senior, no financial maintenance covenants, single-counterparty execution, sitting alongside (not instead of) the EMTN curve.

Instrument Tenor Rate Indicative pricing · illustrative, not a quote
BPA Senior Term Loan · long-dated 25–30yr · 30–55yr outer Fixed only ~ swaps + 175–250bps · ~4.85–5.50% all-in EUR · ~6.50–7.00% all-in GBP
BPA Senior or Bullet Loan · 5yr+ also available 5yr+ Fixed · senior or bullet ~100–200bps margin · priced for risk · government-backed bonds, government contracts, renewables
BPA Senior Term Loan · RNF-wrapped 25–30yr Fixed · ~15–25bps tighter Approximately £15–30m PV saving on a £500m / 25yr facility
Public EMTN · current ESB toolkit 7–15yr · ~20yr ceiling Fixed (bullet) NIE £600m 5.875% 2041 = gilts + ~175bps · ESB Finance EUR 8–12yr ~ swaps + 100–150bps
Bank-arranged USPP 7–15yr · 20yr ceiling rare Fixed Tenor-constrained against ESB's 30–50yr asset life
Bank RCF (€2.4bn · Jul 2025) 5+1+1yr Floating Liquidity, not term capital
A flexible suite, not a single product.  The panel offers 25- to 30-year fixed senior (the flagship long-dated product, 30–55-year outer envelope) and shorter-dated senior or bullet loans from 5 years at 100–200bps margins — priced for risk and applicable to government-backed bonds, government contracts, and renewables. Both products are fixed, covenant-light senior, single-counterparty execution, eight weeks Heads-of-Terms to Exchange, no roadshow.
§ 6 · 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 early 2026 is approximately £7 billion across 30 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
Circle Health (UK) UK acute hospitals £631m 10yr · ~6.9% fixed 2025 IG-equivalent counterparty; senior term format
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
8 weeks
HoTs → Exchange
Bilateral execution timetable · T+5 to Completion
£2trn
combined panel AUM
~£300bn of which is dedicated MA portfolio
§ 7 · The GCCP proposition

A direct introduction to SONG Capital — and the BPA panel behind it.

Grand Canal Capital Partners is the Dublin-based relationship counterparty between Irish and Northern Irish investment-grade issuers and the UK BPA insurer panel. The proposition to ESB is straightforward: GCCP can facilitate a direct introduction between ESB Group Treasury and SONG Capital and its BPA panel. No mandate, no structuring fee, no commitment. A clean treasury-to-treasury introduction.

A
Introduction to SONG Capital
Treasury-to-treasury
GCCP makes the direct introduction between ESB Group Treasury and SONG Capital's origination team. A first conversation between two treasury counterparties — appetite, sizing, indicative tenor, the structuring options described in §§ 1–5.
B
Access to the wider BPA panel
Single-counterparty access to seven insurers
Through SONG, the wider UK BPA insurer panel becomes a single addressable counterparty for ESB — without syndicate fragmentation, without separate roadshow processes, and without piecemeal credit work across multiple insurer credit committees.
C
Context and continuity
A relationship, not a transaction
GCCP holds the institutional context — six months of compounded research across the UK BPA market, the regulatory landscape, the panel's appetite signals, and the European refi calendar. We stay close to the relationship for as long as it is useful to ESB.
D
No commitment from ESB
A first conversation, nothing more
The proposition is a single introduction — no mandate, no exclusivity, no fee structure attached at this stage. If the structuring conversation goes somewhere useful, the form of any onward GCCP engagement is decided by ESB and SONG, not assumed in advance.
§ 8 · Suggested next step

A direct introduction, at your convenience.

If the structuring picture in this briefing is useful, the next step we would propose is a direct introduction between ESB Group Treasury and SONG Capital — a first treasury-to-treasury conversation, no mandate or commitment attached.
The ask
A short call to confirm appetite for an introduction to SONG Capital and the wider UK BPA insurer panel. GCCP can come to Lower Fitzwilliam Street, or meet virtually — whichever suits your team's calendar.
Aaron Sherlock
Founding Partner · GCCP
Dave Murray
Partner · GCCP
IssuerGrand Canal Capital Partners · Dublin, Ireland
AudienceESB Group Treasury · Office of the Chief Financial Officer
ConfidentialityConfidential · for internal ESB review only
Grand Canal Capital Partners
— Grand Canal Capital Partners · 20 May 2026 · v1.0 —