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Online car insurance company may be floated on stock exchange
The AA has revealed that it may be either changing hands or making the leap into floatation on the London Stock Exchange in 2007.
The company, which famously specialises in breakdown cover but has now increased its repertoire to online car insurance, is believed to have hired accountants to weigh up whether either move would be beneficial.
The AA is the number one motoring organisation in the UK and has in excess of 15 million members so it is vital that the decision made about the financial future of the company is the correct one.
There appear to be several parties interested in a possible purchase of the AA, which has an estimated value of £3 billion. However, it is believed that if the company is to be sold, it will probably go to a motor insurance firm or a private equity group similar to CVC and Permira, who are the current owners.
Alternatively, the online car insurance company may get floated on the stock exchange, an idea which has got many investors excited. However, it is thought that the limited international prospects for the company may restrict growth.
It is thought that the accountants' review of the AA will be complete by Christmas 2006 and any further moves will take place in early 2007.
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