Hertz renews bid to merge with Dollar Thrifty
Park Ridge, NJ, United States (AHN) – Hertz renewed its bid to acquire DollarThrifty Automotive Group on Monday, offering a substantially better deal than one proposed by rival Avis, which is being reviewed by federal regulators.
New Jersey-based Hertz offered Dollar shareholders $72 for all outstanding shares. The offer consists of 80 percent, or $57.60, in cash and 20 percent in Hertz common stock. It represents a 26 percent premium to Dollar’s 90-day average share price, and a 24 percent premium to the offer from Avis.
Dollar shareholders rejected an offer from Hertz last September of $50 per share, a price that was raised from $41 in 80 percent cash and the remainder in common stock.
The company’s board of directors had urged shareholders to approve a Hertz merger, saying that Avis had proposed a better offer but had issued little assurance if this offer would be completed soon or would gain clearance from the Federal Trade Commission.
Hertz, the world’s largest airport car rental company, wants to acquire Dollar’s $1.6 billion business, which caters to leisure travelers in 81 countries. The company said it has begun meeting with the FTC about the divestiture of its Advantage brand to ensure that a merger with the Oklahoma-based Dollar would be completed “on an accelerated timetable.”
Mark Frissora, Hertz chief executive, said in a statement, “We have always known that antitrust considerations would be pivotal in any transaction with Dollar Thrifty, and that a combination of Avis Budget and Dollar Thrifty would face serious antitrust obstacles.”
“We are confident we can deliver a compelling proposal to the FTC centered around the divestiture of our Advantage brand, and are committed to working proactively to move through this process as quickly as possible,” he added.
The offer from Avis, which is also headquarterd in New Jersey, had relied on a timetable that required clearance from the FTC by early April. Avis has been seeking regulatory approval for a year.
Dollar said its board would review Hertz’s second offer. “Dollar Thrifty shareholders are advised to take no action pending the Board’s review,” the company said.
View full post on Economy, Business And Finance Stories
