AA could be set for new ownership
The AA could be set for new ownership after it was reported today that preparations were taking place for a £3bn (€4.4bn) sale or flotation.
The motoring organisation, which has 15 million members, is currently owned by CVC and Permira after the European private equity firms bought the company from British Gas owner Centrica for £1.75bn (€2.6bn) in September 2004.
The Mail on Sunday said the AA had appointed accountancy firm PricewaterhouseCoopers to compile a detailed report on its finances to help potential buyers and investors understand the business and its value.
Since being taken over in 2004, the AA has undergone a major restructuring, including the closure of loss-making units and the reduction of its workforce - reportedly from 10,000 staff to around 7,000.
The process has been overseen by Tim Parker, who was hired just after the sale and following his work in turning around car repair chain Kwik-Fit.
Mr Parker is rumoured to have netted more than £20m (€29.5m) from the sale of Kwik-Fit, another CVC investment, and stands to pick up another windfall of tens of millions of pounds from any AA deal, the newspaper said.
The financial check-up, which could be complete by Christmas, will be sent out once a bank has been appointed to run the sale. It is thought this could happen as early as the new year.
The business could attract more private equity interest, while the AA’s strength in insurance may draw approaches from the financial sector.
The RAC, which is Britain’s second biggest motoring organisation, is owned by Norwich Union parent company Aviva. In many countries, particularly on the continent, breakdown services and garages are owned by insurers.
