The private equity owners of British roadside assistance group, AA, are preparing to explore exit options that could value the business at £4.5bn or more, following a sustained turnaround under their stewardship, according to a report by Sky News.
The report cites unnamed sources as revealing that the firm are in advanced discussions to appoint JP Morgan and Rothschild as advisers on a strategic review, paving the way for either a trade sale, IPO, or minority stake divestment in 2026 or later.
The move signals renewed confidence among the AA’s backers, following four consecutive years of revenue and earnings growth, and comes less than a year after Stonepeak invested £450m into the company through a mix of common and preferred equity at a £4bn enterprise valuation.
While no formal transaction is expected for at least 12 months, the appointment of financial advisers marks the first step towards a potential exit, which could result in a significant liquidity event for the long-standing investors. Sources familiar with the process suggest a valuation floor of £4.5bn, reflecting both improved operating performance and robust investor appetite for resilient infrastructure-backed businesses.
The AA, which services over 16 million customers and handled 3.5 million breakdowns in 2024, has evolved under private equity ownership from a distressed public company into a more diversified platform with strong recurring revenue streams, including a sizeable insurance arm and the UK’s largest driving school network.
Since acquiring the AA in 2021, TowerBrook and Warburg Pincus have led a long-term transformation strategy, bringing in new leadership under chairman Rick Haythornthwaite (also Chair of NatWest Group) and CEO Jakob Pfaudler. The business has significantly deleveraged, though it still carries £1.9bn in net debt, according to recent disclosures.
Private equity has a long history with the AA, which was previously owned by CVC Capital Partners and Permira, before listing on the London Stock Exchange in 2014 and being taken private in 2021 at a fraction of its IPO value. The latest investment by Stonepeak echoes a similar multi-sponsor deal at rival RAC, where Silver Lake joined CVC and Singapore’s GIC as co-owners in 2021.
