A takeover of the AA breakdown group was on shaky ground as the company asked for a further extension in the hopes of securing a formal offer from suitors.

On Monday bosses confirmed they had received a non-binding offer of 35p a share from TowerBrook Capital and Warburg Pincus – two private equity houses.

A deadline set for 5pm on Tuesday for a “put up or shut up” offer, where a binding offer must be made or the suitors must walk away, has now been extended by a further 24 hours.

AA
The AA has asked for a deadline for an offer to be extended. (Barry Batchelor / PA)

The move is likely to spook investors who had been hoping a deal for the breakdown company would end six years of pain as a listed company.

The AA said: “The company remains engaged in advanced discussions with the consortium in relation to the possible offer… There can be no certainty that any offer will be made for the company.”

If the suitors make their offer binding, it would see them invest £380 million into the business to pay off high debts and loan repayments due next year, racked up during over-expansion.

Bosses at AA said they will recommend the offer to shareholders, having announced in May that they had been reviewing ways to support the business’s high debts.

The AA said: “The board believes that the company needs a more sustainable capital structure and requires a significant amount of additional new equity in order to reduce the group’s indebtedness and to fund future growth.”

Suitors had been circling the company since August – despite the Covid-19 crisis seeing fewer journeys being made and limiting AA’s opportunity to offer its services as a result.

The shift away from car ownership and fewer care journeys being made historically has also left the company soul-searching for ways to make money.

M1 Motorway
An AA van from 1959 patrolling the M1 motorway (AA/PA)

AA was one of the most high-profile listings in 2014, with armchair investors keen to buy into a company which was founded in 1905 and remains a household name.

But the previous owners pumped the firm full of too much debt and a swift listing price of 250p jumped at points to 450p a share, before plummeting and never fully recovering.

During 2017 there was also a boardroom brawl which saw executive chairman Bob Mackenzie sacked following a fight in a hotel bar where a meeting had been taking place.