UK motoring firm AA Group said today it had completed an initial public offering (IPO) to raise gross proceeds of £1.4 billion. 

The offering, priced at 250 pence per share, was oversubscribed. Its owners, private equity firms Permira, Charterhouse and CVC have agreed to sell their entire 100% stake in the company, AA said in a statement.

AA shares will start conditional trading today. 

The private equity owners had already struck a deal to sell their stakes to a management buy-in team, led by Bob Mackenzie, a former boss of car insurer Green Flag who is to become AA's executive chairman, backed by institutional investors. 

Best known for its roadside recovery services, AA received commitments of over £930m from those investors, which include Aviva , BlackRock and Legal & General. They will take on AA's roughly £3 billion of debt. 

The AA is the UK's biggest motoring organisation and roadside recovery service, with around 16 million members. It also offers motor and home insurance and operates a driving school. 

The firm, which says it rescues a broken-down vehicle every nine seconds, had earnings before interest, tax, depreciation and amortisation (EBITDA) of £422.8m in the year to the end of January. 

Its pre-tax profit was £214.6m, down from £312.7m a year earlier because of an increase in finance costs.