AA set to float on stock market in management buy-in

6th Jun 2014 15:58

Britain's Automobile Association is set to become the latest in a growing string of companies to float on the stock market.The AA's owners, Acromas, plan to sell and float the breakdown recovery service and insurer to a management buy-in team led by Bob Mackenzie alongside the existing AA management team.Institutional investors are also involved, including Aviva, Blackrock, CRMC, GLG Partners, Henderson Global, Henderson Volantis, Invesco, L&G and Lansdowne Partners.Acromas, which comprises private equity firms CVC Capital Partners, Charterhouse and Permira, have received pledges from the buyers worth more than £930m.As part of the offer the company is expected to issue about £210m of new shares, with the rest of the deal comprising the sale of existing shares.The AA will join a burgeoning list of flotations this year including the likes of Poundland, Pets at Home and AO World.Fashion group FatFace pulled plans to list last month on concerns that a flotation would undervalue the business.But Acromas, which has already floated over-50s tour operator Saga this year, is thought to be confident of achieving its target because it already has investor commitments.Admission is expected later this month with a total expected market capitalisation of about £1.4bn.Mackenzie has held executive roles at automotive services businesses including Chairman of van hire group Northgate and Chairman and Chief Executive of National Car Parks and its breakdown subsidiary Green Flag. Mackenzie is expected to be Executive Chairman, working alongside the existing AA Chief Executive Chris Jansen and finance chief Andy Boland.Mackenzie said: "We believe there are significant opportunities to grow the business."PW