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UPDATE – AA confirms £1.4bn float

Published: 17:39 06 Jun 2014 BST

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Britain’s best known UK breakdown firm, the AA, has confirmed plans for a sock market listing that will value the company at £1.4bn.

The roadside recovery group is to issue 554mln new and existing shares at 250p each and has brought forward plans to list to the second half of June.

The accelerated IPO allows investors to bid for the entire offering and buy in quickly, avoiding a bookbuilding process.

It comes despite a disappointing start to listed life from sister company Saga (LON:SAGA), which floated on May 29 and has subsequently seen shares drop over 6%, and when there is seen to be an IPO fatigue descending on the London market.

AA's parent is Acromas, owned by private equity groups CVC, Charterhouse and Permira, who put the AA and Saga together in a £6.2bn merger seven years ago.

The float will see a group of 10 City institutional investors brought together by broker Cenkos.

The listed group is likely to gain admission to FTSE 250.

Executive chairman Bob Mackenzie said: “We believe that as a public company, backed by investors of this quality, the AA will have a core set of long term committed investors to support its continued growth and development. 

“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.”


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