The AA could be taken back into private ownership after being approached by three parties vying to snap up the motoring business.
Shares surged after it told investors on Tuesday that it is in talks with suitors as it looks to reduce its £2.6 billion debt pile.
The breakdown specialist said it has received approaches from Platinum Equity Advisors, Warburg Pincus International, and a joint bid from Centerbridge Partners Europe and TowerBrook Capital Partners.
It said that each party indicated that any offer would see a “significant amount” of new capital being injected into the group to cut its debts.
However, the firm also stressed that there is no certainty that any offer will be made for the business.
Trading has been “resilient” throughout the pandemic and it expects that its financial performance for the current financial year will be “only slightly below” the last full-year.
John Leach, chairman of the company, said: “Following a significant improvement in the underlying performance of the business over the course of the last few years under Simon’s (Breakwell) leadership, the board has been proactively considering a range of potential refinancing options from a position of relative strength and ahead of its upcoming debt maturities in 2022.
“The AA is a high-quality and robust business, with an iconic brand, a resilient business model and a highly committed and loyal workforce.
“However, in order for us to be able to achieve our full potential, the board believes that it must now prioritise reducing the group’s indebtedness to provide the business with the right long-term capital structure – which we hope the current refinancing process will achieve.”
Shares in the company rose by 13.6% to 28.4p in early trading.