Saga staff will receive an average of £10,500 each when the organisation merges with the AA to form a new holding company valued at £6.15bn.
The transaction, which has now been agreed, values the combined group at £6.15bn, comprising the AA’s value of £3.35bn and Saga’s value of £2.8bn.
As a result of the transaction, Saga employees who took up their equity allocation at the time of its management buy-out in 2004, will now make an average of £10,500 each. This sum consists of £8,000 in cash and £2,500 in shares which will be rolled forward into the new company as equity. Some 80% of Saga’s approximate 3,900 staff members took up this offer.
Andrew Goodsell, Saga’s chief executive, has a shareholding of 8% and as head of the combined group is rumoured to receive about £144m as part of the deal, but he plans to roll forward a substantial investment in the new group.
Permira and CVC Capital acquired the AA group in 2004, cutting 3,500 jobs. In light of this latest transaction, the GMB union has criticised the bonuses set to be paid to the private equity bosses.
Paul Maloney, national secretary for GMB, said: “By our reckoning, the managing partners in Permira and CVC stand to make £300 million having owned the AA for less than three years. The chief executive, Tim Parker, we reckon will get £80 million out of this deal. This shows the extent to which we have entered into a Casino economy.
“This money was made on the back of 3,500 sacked workers, cuts in the pay of the call centre staff, the elongation of the working day for the patrols and a decline in the service to the customers. GMB will want to talk to the new owners, Saga, about reversing these cuts and getting back to reasonable working hours and improving services for the customers.”