Tags: US | Avis | Dollar | Thrifty

Avis Returns with a Bigger Bid for Dollar Thrifty

Thursday, 23 Sep 2010 12:24 PM

PARSIPPANY, N.J. (AP) — Avis raised its offer for Dollar Thrifty to $1.52 billion in cash and stock Thursday, one week before a scheduled vote by shareholders on a bid from rival car rental company Hertz.

The latest offer from Avis values Dollar thrifty at $53 per share, compared with a $50 per-share offer from Hertz.

The rental-car rivals are fighting for control of Dollar Thrifty to gain additional access to vacationers and premium business travelers.

The entire industry has been hammered by a drop-off in business car rentals and that has created a new urgency to capture leisure travelers and others that are still spending money to travel.

Avis' prior offer was worth $1.36 billion and included $40.75 per share in cash, and the same stock portion.

Avis also appealed directly to Dollar Thrifty shareholders, who may decide the company's fate in a matter of days.

"We believe it would be beneficial for Dollar Thrifty shareholders if the Dollar Thrifty Board of Directors engaged in a process to maximize value, rather than letting Hertz dictate timing and process," Avis said in an open letter Thursday.

A larger bid from Avis had been expected ever since Dollar Thrifty Automotive Group Inc. accepted Hertz bid earlier this month. That offer was worth $1.56 billion including restricted stock and stock options and cash of $43.60 per share.

Avis' new offer is worth $1.52 billion per share, based on 28.7 million shares outstanding.

The company boosted the cash portion of its offering by more than $5 per share to $45.79. Both offers include .65 shares of Avis Budget stock.

Dollar Thrifty, headquartered in Tulsa, Okla., scheduled a special shareholders meeting for Sept. 30 to vote on the Hertz offer.

Shares of Dollar Thrifty soared on the news, setting a new 52-week high of $53.

Shares of Avis Budget Group Inc. fell 28 cents or 2.5 percent to $10.74, while shares of Hertz Global Holdings Inc. fell 22 cents, or 2 percent, to $10.65.

Avis said the increased bid was necessary "based on improving fundamentals in the industry and at Dollar Thrifty in particular."

A $44.6 million reverse breakup fee is still in place with Hertz and Avis said it would offer more money if the break-up fee is removed.

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PARSIPPANY, N.J. (AP) Avis raised its offer for Dollar Thrifty to $1.52 billion in cash and stock Thursday, one week before a scheduled vote by shareholders on a bid from rival car rental company Hertz.The latest offer from Avis values Dollar thrifty at $53 per share,...
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2010-24-23
Thursday, 23 Sep 2010 12:24 PM
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