Avis Budget has reached an agreement to buy its European counterpart Avis Europe for £636 million.
The move will reunite the two Avis businesses after 25 years apart.
The groups will have combined revenue of approximately $7 billion and owned or licensed operations in more than 150 countries.
“This transaction represents an outstanding opportunity for Avis Budget, and the acquisition of a business that we have long sought to own,†said Avis Budget chairman and chief executive Ronald Nelson.
“The transaction re-unites the global operation of the Avis and Budget brands under one corporate umbrella, and is both financially and strategically compelling.
“We expect the combination of our two companies will allow us to more effectively serve vehicle-rental customers worldwide, and to achieve synergies of more than $30 million per year. In addition, the acquisition will give Avis Budget an increased presence in rapidly-growing international markets, including India and China.
“From a financial perspective, we expect the acquisition of Avis Europe to be accretive to Avis Budget’s earnings per share on a pro-forma basis with synergies, excluding any integration and other one-time costs and the non-cash effects of purchase accounting.
“Because the Avis Europe and Avis Budget Groups generally do not have operations in the same jurisdiction, the acquisition is not expected to face significant antitrust obstacles.”
By Bev Fearis
