Acromas has £700m interest on debts of £6.6bn
AA Insurance’s parent, Acromas, racked up a £458m loss last year after paying out £700m in interest on debt.
The debts of Acromas rose from £6.3bn to £6.6bn. The huge interest payments on debts meant the £241.6m in operating profits was wiped out and the business fell into the red.
The AA, which includes the insurance unit and the roadside recovery business, contributed £883m of the £1.8bn turnover.
In a bright spot, group turnover increased 11% to £1.8bn and pre-tax loss was an improvement on last year’s deficit of £529m.
Acromas was created out of the huge private equity deal involving Charterhouse, Permira and CVC in June 2007, funded by £4.8bn bank borrowings and £1.5bn in shareholder loans.
Charterhouse also owns majority stakes in broking consolidator Giles and credit hire firm Drive Assist, which like Acromas, have a financial situation where interest payments exceed earnings on a pure accounting basis at the last filed accounts.
Hosted by comedian and actor Tom Allen, 34 Gold, 23 Silver and 22 Bronze awards were handed out across an amazing 34 categories recognising brilliance and innovation right across the breadth of UK general insurance.
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