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AA to sell shares worth 200 million pounds -Sky News
March 24 (Reuters) - AA Plc, best known for roadside recovery service, plans to raise about 200 million pounds through a share placing as part of a refinancing move aimed at reducing its debt, Sky News reported, citing sources familiar with the matter.
The share sale is to be accompanied by a refinancing of 735 million pounds of its senior debt facilities and could be announced as early as Wednesday, Sky News reported.
Proceeds of the sale will be used to replace the balance of an expensive form of debt, known as payment-in-kind, Sky News reported.
Payment-in-kind notes are financial instruments that pay bondholders or preference share holders with interest or dividends in the form of additional debt instead of cash.
The investors that have been approached for the share sale are expected to be supportive taking into account the strong performance of the company, Sky News reported, citing sources.
Francesca Tuckett, a spokesperson for AA declined to comment.
Credit Suisse (LSE: 0QP5.L - news) , Morgan Stanley (Xetra: 885836 - news) and Royal Bank of Scotland were involved in the motoring group's refinancing, which could be delayed to later this week, Sky News said, citing sources.
Credit Suisse, Morgan Stanley and Royal Bank of Scotland (LSE: RBS.L - news) were not available for comment outside regular working hours. (Reporting by Zara Mascarenhas in Bengaluru; Editing by David Gregorio)
