Hertz Global Holdings, Inc. and Dollar Thrifty Automotive Group, Inc. today announced that they have entered into a definitive merger agreement under which Hertz would acquire Dollar Thrifty for $87.50 per share in cash in a transaction valued at a corporate enterprise value of approximately $2.3 billion.
As part of the deal, Hertz has reached an agreement to sell Advantage (currently its car rental leisure arm) to Franchise Services of North America and Macquarie Capital. Other car rental companies within that stable are: U-Save, Rent-a-Wreck, Practicar and X-Press Rent-a-car. That sale is contingent upon the successful merger of Hertz and Dollar Thrifty.
This deal has been in the works for around three years, and allows the combined car hire brands to compete with other multi-brand car rental companies, such as Enterprise, which owns Alamo, National and Enterprise, in differing markets: Hertz for Business car hire, Dollar for leisure car hire and Thrifty for economy car hire.
How will it affect you? Well for quite a while, it won’t! Nothing will change in the short term as the transaction still has to clear the regulatory hurdles of the Federal Trade Commission. There is likely to be no particular changes to the car hire brands, as each is well defined in its area – but with economies of scale behind the scenes, and the ability to fleet share and share desk space – new on-site car hire desks at airport locations may arise and capacity at peak times will be helped. In the long-term, we may see Hertz cars arrive in our search results, and Advantage may, or may not disappear.
But for now, nothing changes!