The AA receives takeover proposal

The AA has outlined a potential takeover by investment management and private equity firms, TowerBrook Capital Partners and Warburg Pincus International.

The possible cash offer would value 35 pence per AA share for the entire share capital of the company, a 40% premium to the firm’s closing share price on 3 August.

Also featured in the proposal is the intention to invest approximately £380m into the AA to “facilitate debt reduction”.

This investment will support a refinancing of £541m existing class B2 secured notes maturing in July 2022 and £372m class A5 notes maturing in January 2022.

A statement by the AA said: “The board, having considered carefully the viability of a range of alternative potential debt and equity refinancing options together with its financial advisers, has indicated to the consortium that it would be willing to recommend a cash offer on the terms of the proposal.  

“Accordingly, the company is engaged in advanced discussions with the consortium in relation to the possible offer.”

A deadline of no later than 5.00pm on 24 November was originally given to the potential suitors. However, a 24 hour extension has been granted to the consortium to either announce a firm intention to make an offer or a withdrawal from the takeover.

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