Hertz has entered into a definitive agreement to acquire car hire rival Dollar Thrifty, more than two years after first making its first bid for the company.
The final offer is worth US$87.50 per share, which totals approximately US$2.56 billion – more than double Hertz’s original US$1.2bn bid placed back in 2010. Since then Hertz has been embroiled in a bidding war with the Avis Budget Group, with the latter company finally pulling out earlier this year. The Hertz deal, which has been unanimously approved by the directors of both companies, will be an all cash transaction.
Hertz said the merger between itself and Dollar Thrifty would create a “global, multi-brand rental car leader”.
“We are pleased to have finally reached an agreement with Dollar Thrifty after a lengthy – but worthwhile – pursuit,” said Hertz’s Chairman & CEO, Mark P. Frissora. “We have always believed that a combination with Dollar Thrifty is the best strategic option for both companies. The transaction provides Hertz instant scale with two new, well-established brands with airport concession infrastructure in the mid-tier value segment. We’ll be a stronger global competitive player with a full range of rental options not only in the US but in Europe and other markets given Dollar Thrifty’s strong international presence.”
Dollar Thrifty’s President, CEO and Chairman, Scott Thompson, said that Hertz made a “compelling offer”, and that the deal would give his company “the resources to expand our value focused leisure brands in key car rental markets around the world”. The combined company will offer approximately 10,000 locations across the world.
Meanwhile Hertz has also announced a deal to sell its Advantage business to Franchise Services of North America (FSNA) and Macquarie Capital. The price of the deal was not revealed, but Bloomberg – citing people said to be familiar with the deal – reported that it was worth US$16m.