Vulcan Alpha Bidco, the Veritas Capital vehicle acquiring Bodycote (LSE:BOY) through a scheme of arrangement, has reworked its financing after putting a foreign exchange hedge in place, while the Acquisition terms themselves are unchanged.

What was announced

Veritas Capital Fund Management, L.L.C. (Veritas) published an update on 30 October 2026 on the financing behind the recommended cash acquisition of Bodycote (LSE:BOY) plc by Vulcan Alpha Bidco Limited (BidCo). BidCo is a newly formed company indirectly wholly owned by funds managed or controlled by Veritas. The acquisition is being implemented by way of a scheme of arrangement under Part 26 of the Companies Act 2006.

The announcement covers two changes: a reduction in the Equity commitment backing the deal and the addition of two new banks to the Debt package. It does not announce any change to the price or other terms of the acquisition, and it does not give a completion timetable or an expected effective date for the scheme.

The equity change

Under an original equity commitment letter dated 1 September 2026, The Veritas Capital Fund IX, L.P., together with certain other Veritas vehicles (the Equity Investor), committed up to $1,511,097,145.51 to BidCo.

On 30 October 2026, BidCo and the Equity Investor amended and restated that letter, reducing the total commitment to $1,293,976,000.00. By our calculation, that is a reduction of about $217.1 million, or roughly 14%.

The announcement links the change to BidCo's execution of a "transaction contingent foreign exchange hedge agreement" covering the cash consideration payable under the acquisition. The cash consideration is expressed in pence per Bodycote (LSE:BOY) share, while the equity commitment is denominated in US dollars. The announcement does not explain the mechanics of the reduction further, and it does not disclose the hedge counterparty, the rate secured or other terms.

The debt change

On 1 September 2026, Vulcan Alpha Midco 2 Ltd signed a debt commitment letter with the Original Interim Lenders: Bank of America, N.A., London Branch; Deutsche Bank AG, London Branch; UBS AG London Branch; Citibank, N.A., London Branch; and Citicorp North America, Inc. A fee letter, syndication letter and conditions precedent status letter were signed the same day.

On 30 October 2026, Barclays Bank PLC and HSBC Bank plc, described as the New Interim Lenders, agreed to become mandated lead arrangers and interim lenders under the Interim Facilities Agreement, alongside the original group. The Interim Facilities Agreement, the original commitment letter and the related financing documents were amended and restated to bring the new lenders in. The announcement does not state whether the total size of the debt facilities has changed.

Background

The recommended acquisition was set out in a Rule 2.7 firm offer announcement on 1 September 2026. According to reporting of that announcement by Pulse 2.0, the terms value each Bodycote (LSE:BOY) share at 940 pence, made up of 932.8 pence in cash and a 7.2 pence Interim Dividend for the 2026 financial year, implying a fully diluted equity value of about £1.65 billion and an Enterprise value of about £1.85 billion. Completion was expected in the first quarter of 2027, subject to court, regulatory and competition approvals.

Bodycote (LSE:BOY) published its Scheme Document on 28 September 2026. At the Court Meeting and General Meeting held on 21 October 2026, all Shareholder resolutions were approved by the requisite majorities.

What to watch next

The amended equity commitment letter and financing documents are available on a dedicated Veritas document website, subject to restrictions in certain jurisdictions. Copies of documents required under Rules 26.1 and 26.2 of the Takeover Code are due to be published on the Bodycote and Veritas websites by 12 noon on the Business day after the announcement.

With shareholder approval already secured, the remaining steps are the outstanding regulatory and competition clearances and the court sanction hearing.