Summary Note Post Bondholder Call

01/03/2018

AA Plc

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AA provides automobile insurance and breakdown cover. Its heritage dates back to 1905 when the company was founded by a group of motoring enthusiasts. Today there are more than 3m members. In 2004 the group was acquired by private equity groups CVC and Permira. The group IPO’d in 2014, subsequently selling AA Ireland in 2016.

In late September 2017 AA plc appointed Simon Breakwell as its CEO. He has led a “rigorous, bottom up review of the business” which led to a mid-February strategy update in which the group signalled a change in direction as well as a profit warning, and substantial cut in the dividend. The equity fell from 120p to around 75p, while the subordinate B tranche bonds dropped circa ten points. Following a well-received bondholder call yesterday, prices have ticked up from the early week lows.

Please see our note below:

AA plc – March 2018

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