RAC Gears Up For Float With Rake Appointment
The CBI president Sir Mike Rake is in talks to become chairman of the RAC breakdown recovery service ahead of a potential £2bn stock market listing.
Sky News has learnt that Sir Mike is a leading candidate to chair the company, which is owned by the private equity firm Carlyle.
Bankers said that the RAC was expected to make an announcement about its new chairman this week, with Sir Mike understood to be the frontrunner.
Carlyle has not yet formally decided to pursue a stock market flotation, and is continuing to evaluate its options in the wake of the recent listing of the AA, its larger rival.
Assuming that Sir Mike does accept the role, it would add another significant boardroom position to his portfolio.
The deputy chairman of Barclays, he recently ruled himself out of the running to succeed Sir David Walker at the helm of the bank.
He also chairs BT Group, is a director of McGraw-Hill, the US-based owner of the Standard & Poor's ratings agency, and is on the board of various charities.
The RAC's next chairman will replace Rob Templeman, a businessman who has earned handsome rewards from the turnaround of various retail and consumer businesses, including Debenhams and Homebase.
Sky News reported last month that Carlyle had held preliminary talks with a number of other private equity groups about a £2bn sale of the RAC, although insiders insist that a flotation remains the likelier outcome.
In May, Carlyle appointed Lazard, the investment bank, to advise it on options to exit its investment, on which it hopes to have doubled the value of the RAC.
Since then, banks including Barclays, Citi, Goldman Sachs and JP Morgan have been hired to act as bookrunners for an initial public offering (IPO).
The RAC, founded by the Royal Automobile Club in 1897, has more than seven million members, and has about 2,000 patrols which attend 2.5 million breakdowns every year.
The RAC, which is owned by the same private equity group as Addison Lee, the London-based taxi company, is chaired by Rob Templeman, who is expected to step down ahead of a flotation.
Its chief executive is Chris Woodhouse, with whom Mr Templeman worked at Debenhams, the department store chain.
Aviva sold the RAC in 2011 to focus on its core insurance operations but was widely regarded to have undervalued the RAC by offloading it for £1bn.
Last November, the RAC paid its owners a £163m dividend as it emerged that the company was on track to make £145m in pre-tax profit last year, almost double its 2010 earnings.
It recently announced the launch of its first mobile electric vehicle charging unit and has begun selling telematic tracking devices, a growing trend among motor insurers.
An RAC spokeswoman declined to comment on the appointment of a new chairman.