US investor takes £450m stake in the AA

Stonepeak’s investment values the breakdown expert at around £4 billion, the companies said.

The breakdown specialist AA was bought in 2021 (Matt Faber/PA) (PA Archive)

US investor Stonepeak has taken a nearly half billion-pound stake in breakdown expert the AA, three years after the then debt-ridden company was sold.

The investment of £450 million will value the AA at about £4 billion, the companies said on Wednesday.

Former owners Warburg Pincus and TowerBrook, both investment firms, will remain the majority shareholders in the AA.

They bought the company back in 2021 for £219 million, but also took on a multi-billion pile of the AA’s debts.

Since then the new owners say they have completed the first of several phases of a fresh strategy, which has seen it return to growth and accelerate its profitability.

AA chief executive Jakob Pfaudler said the company’s momentum is “strong” and the investment will allow it to “deleverage” – another word for reducing debt.

We are excited about the future prospects of the business

Jakob Pfaudler, AA chief executive

“We are delighted to welcome Stonepeak as a new shareholder in the AA, as they bring a wealth of skills and expertise in transportation and critical infrastructure,” he said.

“We have strong momentum, having recently reported positive revenue, profit, and customer growth, and we are excited about the future prospects of the business.

“This investment allows us to further deleverage whilst continuing to invest in our customers and people as we build a more digitised service offer to create long-term value for all our stakeholders.”

Stonepeak senior managing director Nikolaus Woloszczuk said: “We view the AA as a critical provider of transport services, underpinned by its unique network of nationwide patrols, and we are delighted to be investing to support this essential piece of the UK’s transportation system.

“With its market leading position, scale, iconic brand, and the resilient nature of its underlying market, we believe that the AA has the right fundamentals in place to accelerate growth, and we look forward to working with the AA, Warburg Pincus, and TowerBrook, as the company continues its development.”