AA Ireland sold to Carlyle Cardinal Ireland and Carlyle Global Financial Services in multi-million euro cash deal
Published 01/07/2016 | 02:30
State-backed Carlyle Cardinal Ireland and Carlyle Global Financial Services are to buy the AA's Irish business for €156.6m in an all-cash deal.
The deal, which also includes consideration for cash left on the AA's balance sheet, is expected to be completed by the end of July.
AA Ireland will continue to use its own brand and intends to use the net cash proceeds for partial repayment of its debt.
The business in Ireland will continue to be run by the current executive team, who have also invested in the company, led by AA CEO Brendan Nevin.
AA provides car and home insurance, as well as servicing, motoring advice and breakdown cover.
Mr Nevin said the firm was "excited" that AA Ireland would be run by its local management team. "Our new owners have a proven track record of success across the sectors we operate in, which will benefit AA Ireland as we look to continue growing the company."
Cardinal Capital Group managing director John Dolan said the private equity fund is eyeing up more Irish investments.
"This is CCI's seventh investment in growing Irish companies since 2014 and we continue to explore further potential investments. The AA Ireland is a fantastic brand with a high degree of recognition and trust among consumers," he said.
Carlyle Group managing director Peter Garvey said his firm has a "keen understanding" of the motoring and insurance services sectors.
"We are committed to working with Brendan and the executive team, supporting continued investment to deliver fantastic products and services to the Irish market," he said
The deal comes after the firm announced it would be moving into the life insurance market.
Carlyle is an active investor in medium-sized businesses here with stakes in Carrolls Cuisine, Lily O'Brien's, Payzone and cash in transit business GSLS.
Revenue in AA Ireland dipped last year to £38m (€46m), down £1m on the previous year.
The deal is subject to approval from the Competition and Consumer Protection Commission and the Central Bank.