Travel and financial services group
The move comes a few weeks after rumours that the company had received unsolicited bids, but it is understood that the deal will not be done using a dual-track process.
This is the second time the company has considered an IPO, with the previous occasion in 2004 ending with a £1.4bn (€2.1bn) sale to Charterhouse.
The sale achieved £150m–£200m more than was forecast for a deal in the public market, but strong growth over the past two years and diversification into financial services means that an IPO is now expected to value the company at about £2.5bn.
Saga is understood to be keen to organise a retail tranche for its customers, as it did in 2004. A good level of demand is expected from them, and there are likely to be offers to employees and the public as well.
However, the company will also be keen to avoid disappointing its client base by going through an extensive consultations process and then opting for a private sale, as happened in 2004.
No firm timetable has yet been given but the planning and organisation required for a large retail offering means the deal is unlikely to happen before September.
Bankers believe the deal will generate considerable publicity for the company and private equity group Charterhouse, which owns approximately 80% of the stock, is likely to retain a significant stake post-IPO in order to benefit from the good level of forecast growth.