Aviva linked to RAC sales move

Insurance giant Aviva is considering the sale of the RAC breakdown business it acquired for £1.2bn (€1.4bn) in the UK six years ago, it was reported today.

The sale process is said to be in the early stages but the Times newspaper reported that several parties, including private equity, have expressed an interest in the UK’s second biggest roadside recovery service.

Aviva has disposed of several parts of the business since the acquisition in 2005, including the BSM driving school, RAC France and Auto Windscreens. It is thought to be looking for proceeds of around £600m (€682m) from any sale.

At the time of the takeover Aviva said it wanted to increase the rate that RAC sold additional products to its membership from 13% to more than 50%.

RAC, which was founded in 1897 and has seven million members, was bought by Aviva a year after the AA was snapped up by a private equity consortium for £1.75bn (€2bn).

The sale process, overseen by chief executive Andrew Moss, is part of Aviva’s strategy of streamlining the Aviva business, which sells life, pension and general insurance products and also runs a fund management business.