The private equity owner of the AA and Saga has committed more than £122m to US online giant LegalZoom.

European private equity firm Permira announced yesterday it will become the largest shareholder in one of America’s biggest legal brands once the acquisition is complete.

LegalZoom is expected to launch fully in the UK this year having steered more than two million US small businesses and individuals to legal advice since it was founded 12 years ago. The company is not a law firm itself, but it offers online legal documents and puts clients in touch with a panel of firms and lawyers.

In its statement, Permira said the funding will strengthen the online provider’s ‘significant’ growth plans, which include potential acquisitions in both the US and abroad.

‘LegalZoom is the clear leader in the huge untapped market for small business and family law,’ said Dipan Patel, a principal at Permira.

‘The company has strong brand recognition, a unique value proposition and a proven track record. We’ve been impressed by the team’s development of multiple successful subscription products, which, in less than four years, now represent more than 30% of revenue, growing in excess of 35% per year.’

The funding has allowed LegalZoom to cancel plans for a public share offering.

Under the terms of the transaction, LegalZoom’s management team will maintain partial ownership in the company. Other major shareholders include Polaris Venture Partners and Institutional Venture Partners.

A holding company backed by Permira will have the right to appoint a majority of the board of directors. The money itself has been raised from pension funds and other institutions.

Permira now has around £18bn committed to 200 different companies, mostly in the technology, media and telecom sectors.

It successfully acquired the AA and Saga for around £8bn in 2007 under its holding company Acromas. Both entities were granted alternative business structure status by the Solicitors Regulation Authority last year and are authorised to offer reserved legal services.