The AA intends to raise almost £1 billion from share and loan sales as it moves to tackle its mammoth debt and resume dividend payments.
As part of the plan, which was accompanied by a strategic update and the publication of annual profits, the recently listed roadside recovery group said that it would raise £200 million from a placing with shareholders.
The proceeds of the issue will be used to pay off “payment-in-kind” or PIK loan notes, which carry an interest rate of 9.5 per cent. The group will also raise £735 million through the issue of new loans, using the money to repay or refinance existing borrowings.
The refinancing will leave the AA with debts little changed at just under £2.9 billion, but with