RAC slams brakes on blockbuster London IPO
The RAC has slammed the brakes on its £5bn London listing in favour of a private deal, landing another blow against the UK’s ailing public markets.
Britain’s oldest breakdown recovery service has begun working on a deal which would see private equity backer CVC Capital Partners remain a major investor while other shareholders exit the firm.
American private equity firm Silver Lake and Singaporean state investment fund GIC are in advanced talks to sell their stakes in the motoring services company to CVC and other investors, City AM has learned.
The deal, if completed, would delay the company’s much-anticipated Initial Public Offering (IPO) by at least 18 months and likely even longer, it is understood.
Were the RAC to significantly delay its float, the decision would extend the drought blighting the London Stock Exchange, as firms queue up for floats but are yet to give the green light.
CVC has been a shareholder in the RAC since 2015, when it snapped up the stake held by rival buyout firm Carlyle.
Rumours of the group’s London IPO were fuelled in March when it held preliminary meetings with prospective investors and fund managers.
The West Midlands-based firm has become one of the UK’s best-known roadside assistance groups since it was founded as the Royal Automobile Club in 1897.
Last month, the firm posted a six per cent uplift in revenue to £463m in the six months to June, pushing up its pre-tax profit by a fifth to £76m.
‘Strong momentum’ at RAC
The firm hailed a “strong” performance across its “holy trinity” of breakdown, insurance and maintenance services, notching a six per cent jump in membership to 15.9m.
The company said: “RAC enters the second half of 2026 with strong momentum and is well positioned for sustainable growth.
“The group has increased memberships and total annual recurring revenue, expanded margins, scaled SMR and continued to improve efficiency through disciplined pricing, digital investment and operational execution.
“Together with strong cash generation and reducing leverage, this supports confidence in the outlook for the remainder of 2026 and in delivering a 15th consecutive year of [earnings] growth.”
The RAC’s private deal talks, first reported by Sky News, come as London is suffering an IPO drought and seeing a number of listed firms be snapped up by overseas private investors.
The London Stock Exchange has seen just seven listings in the year to date, raising a combined £557m.
The UK suffered a similar slowdown in listings last year but this was ended by a late flurry of floats, with British bank Shawbrook and tinned tuna maker Princes Group among the late entries.