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The AA prepares stock market flotation after buy-in

The AA has announced intentions to proceed with a management buy-in and flotation.

The buy-in team is led by Bob Mackenzie alongside the existing AA management team, and backed by institutional investors, including Aviva, Blackrock, CRMC, GLG Partners, Henderson Global, Henderson Volantis, Invesco, L&G and Lansdowne Partners.

The AA's owner, Acromas, has received binding commitments from the team and its backers of more than £930m to acquire shares.

In addition, around £210m of new shares are to be issued. Acromas would retain a 31% stake in the AA, the UK's market leading roadside assistance provider.

The AA has four million personal members and nine million business customers.

Admission is expected to take place in the second half of June 2014 and the total expected market capitalisation of the Company at Admission will be approximately £1,385 million.

The sale follows an approach made to the Acromas by a management buy-in team led by Bob Mackenzie, chairman of Northgate vehicle fleet management business, and former chairman and CEO of National Car Parks and its subsidiary Green Flag, and including Dr Martin Clarke and Nick Hewitt.

It is proposed that Mackenzie will be executive chairman, working alongside the existing AA CEO, Chris Jansen, and existing CFO, Andy Boland.

Mackenzie said: “The AA is a very successful organisation with a strong record of serving its members and the needs of the UK motorist. We believe there are significant opportunities to grow the business, a sentiment shared by the high quality leading cornerstone investing institutions who have already committed over £930 million to the transaction."

He added: "The AA is a fundamentally strong business and underpinning our approach is a clear strategy to invest in systems and new technologies to further enhance the service provided to our members and customers; to steadily reduce the AA’s existing debt; and to develop the growth opportunities that we have identified."

Chris Jansen, chief executive said this is a very exciting and timely development for the AA and marks the start of a new chapter for the company and its 8,000 employees.
 

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