Hertz, Dollar Thrifty set $50 merger share price - Car Rental News
Hertz, Dollar Thrifty set $50 merger share price
Car Rental News - 13/09/2010
Firms speed shareholder vote, Hertz starts Advantage Rent-a-car divestiture.
Auto hire companies Hertz Global Holdings and Dollar Thrifty Automotive Group have announced that they have agreed to alter their merger deal so Hertz acquires Dollar Thrifty at a new higher share price of 50 dollars. The new bid for Dollar Thrifty by Hertz raises the cash portion of the deal, bringing the total value of the offer to 1.43 billion dollars in cash and stock.
The new deal has been agreed in order to thwart an attempt by Avis to wrest Dollar Thrifty from the clutches of Hertz. As an additional step to speeding up the takeover, Hertz has already begun the process of divesting itself of Advantage Rent-a-car. Hertz agreed to sell of Advantage in order to assuage the concerns of antitrust authorities.
The new offer from Hertz comprises an enhanced cash component of 43.60 dollars, plus .6366 Hertz shares. This latest agreement boosts the price Hertz is paying for Dollar Thrifty by 22 per cent, compared to the original offer from Hertz. The Dollar Thrifty acquisition provides increased presence in the lucrative leisure car hire business. Both Hertz and Avis are keen to bolster their businesses in this sector as the business rentals market remains flat amidst ongoing concerns for the economy.