Staff told that private equity owners will dispose of business within a year
Senior staff at the AA have been told that the company will "either float or be sold" by its venture capitalist owners, CVC and Permira, in the next twelve months, Insurance Times has learned.
It comes as the AA's three-year relationship with CVC and Permira nears its end.
Insurer, AXA was believed to have been interested in acquiring the broker, but talks broke down earlier this year and AXA pulled out.
Venture capitalist Kohlberg Kravis Roberts (KKR) was also linked to the trade sale.
The AA has moved to calm fears of job insecurity at the company by telling strategic staff that a sale was "still several months away".
One insider said: "There was all this talk about the AA being up for sale and staff were a little concerned. But then we were told that if there is a sale it will be at the end of 2007, beginning of 2008.
"Alternatively the AA will be floated."
The source continued: "The AA's most valuable asset is its branding. Nobody wants to see that diminished, so a float would be preferable."
Another senior broker added that staff were fully aware that the relationship with CVC and Permira would come to an end after three years.
The broker said: "Senior staff knew that is what they were working towards. I would be very surprised if they aren't marketing it hard at the moment.
"I don't think the insurance business can be hived off from the rest, since brand is central to its value and [the AA] wouldn't split the brand."
An AA spokesman said: "At some stage both the option of selling or floating will be open to us, but no timings have yet been agreed."