AA and Saga cleared

The merger by the private equity funds CVC Capital Partners, Charterhouse Capital Partners and Permira of the UK travel company Saga Holdings and the AA was cleared today by the European Commission.

Although both companies are active in the UK automotive services sector, the Commission felt that the level of Saga’s involvement would not raise competition issues.

However in the current market Saga’s agreed merger with the AA could be delayed due to difficulties syndicating the debt financing for the deal.

It is believed that Barclays and Mizuho, the lead underwriters of the debt package, have been unable to find banks willing to sub-underwrite the loans.

The AA provides breakdown rescue for motorists as well as auto-related financial services whilst Saga provides services for the over 50s, including insurance, holidays, financial services and health information.