AA group raises £1.4 billion in London float but shares slump
Monday 23 June 2014
The AA became a public company for the first time in its 109-year history today after a decade under private-equity control.
The roadside assistance group was valued at £1.4bn as it joined the London Stock Exchange, completing one of the most anticipated flotations in recent years. However, despite the fanfare surrounding the float, shares slumped 7.2 per cent below the 250p offer price.
The move is a significant landmark for the AA, which was founded in London’s West End by a group of motoring enthusiasts, hoping to help drivers avoid police speed traps.
The company was owned by its members until 1999 when it was acquired by Centrica for £1.1 billion. The energy group eventually sold the AA to CVC and Permira five years later, who eventually combined it with over-fifties group Saga in a highly leveraged £6.2 billion merger.
The AA now has 13 million members, four million of whom are individuals and the rest business-to-business customers. Unlike its former sister company, which flopped when it floated last month, the AA was sold by its private-equity owners before it went public.
In an unusual buy-in deal, the group was acquired by a management team led by former Green Flag boss Bob Mackenzie, backed by City investors like Aviva and BlackRock.
Mackenzie, who will be the AA’s executive chairman, said part of the £185 million raised would be used to pay down the £3 billion of debt the management team inherited from the AA’s former owners.
The group’s management team — which also includes chief executive Chris Jansen — stands to make as much as £60 million over the next five years if the AA’s total shareholder return increases by an average of 12 per cent a year.
“We have spent a couple of years looking at this business and are delighted to have received the backing of leading UK institutions,” Mackenzie said.
- 1 2015 General Election: Green party will not appear in TV debate alongside Ukip – says BBC
- 2 Canadian actor punched in face after 'Islamophobia' experiment goes wrong in wake of Ottawa shooting
- 3 Topshop at centre of row over body image as 'shocking' skinny mannequin photo goes viral
- 4 Kentucky gang rape: 15-year-old boy left in critical condition after sexual attack by group at party
- 5 Of course, teenage girls need role models – but not like beauty vlogger Zoella
'Nasa Confirms Six Days of Darkness in December': No, they don't - it's a hoax
Canadian actor punched in face after 'Islamophobia' experiment goes wrong in wake of Ottawa shooting
Tim Cook: Apple CEO comes out as gay publicly for the first time 'It's among the greatest gifts God has given me'
Topshop at centre of row over body image as 'shocking' skinny mannequin photo goes viral
Halloween 2014: From the Screaming Man of Pluckley to the 'White Lady' of the Tower of London - Britain's 20 most haunted places
Pope Francis declares evolution and Big Bang theory are real and God is not 'a magician with a magic wand'
Huge surge in Ukip support after EU funding row, according to new poll
Ukip ‘exploiting grooming scandal’ to secure party’s first police chief
Nigel Farage: 'There’s nothing wrong with white people blacking up'
Muslims, immigration and teenage pregnancy: British people are ignorant about almost everything
Maureen Lipman says 'she can't vote Labour while Ed Miliband is leader'
iJobs Money & Business
£20000 - £23250 Per Annum pro rata: Clearwater People Solutions Ltd: Pro rata ...
£40 - 48k + Benefits: Guru Careers: We are seeking a Marketing Manager to join...
£45,000 - £65,000: Saxton Leigh: Our client is a well-known APAC Corporate and...
£60000 per annum: Ashdown Group: Compensation and Benefits Manager - Compensat...