The United States Federal Trade Commission today announced its approval of the sale of 12 of the Locations to Avis Budget Car Rental, LLC (“Avis”) and 10 Locations to The Hertz Corporation (“Hertz”). Avis and Hertz were previously selected as successful bidders for the Locations in accordance with bidding procedures approved by the United States Bankruptcy Court for the Southern District of Mississippi (the “Court”) in the Simply Wheelz insolvency proceedings.
Pursuant to binding term sheets agreed to by the respective parties and approved by the Court: (i) Avis will acquire 12 Locations (the “Avis Asset Sale”) for consideration of approximately US$6 million in cash, plus the assumption of certain liabilities of the Advantage business associated with such Locations; and (ii) Hertz will acquire 10 Locations (the “Hertz Asset Sale”) for consideration of approximately US$200,000 in cash, plus the assumption of certain liabilities of the Advantage business associated with such Locations and the continued right of Advantage to use Hertz’s vehicle fleet during April, May and June 2014, which the parties agreed had a value of approximately US$3.5 million.
Completion of the sale of each individual Location may remain subject to receipt of appropriate third party approvals in respect of such Location; however, the total consideration for the Avis Asset Sale will be payable by Avis upon closing of the sale of the first Location pursuant to the Avis Asset Sale and the total consideration for the Hertz Asset Sale will be payable by Hertz upon closing of the sale of the first Location pursuant to the Hertz Asset Sale.
The sale of all Locations pursuant to the Avis Asset Sale and the Hertz Asset Sale is currently expected to be completed by the end of June 2014.
Simply Wheelz filed for bankruptcy protection under Chapter 11 of the United States Bankruptcy Code on November 5, 2013.