Hertz Global Holdings, Inc. announced that it has completed the acquisition of Donlen Corporation (“Donlen”), a leading provider of fleet leasing and management services. The acquisition was funded by $177 million in cash proceeds from Hertz and the assumption of $770 million in Donlen fleet debt.
Donlen provides Hertz an immediate leadership position in long-term car, truck and equipment leasing and fleet management. This transaction is part of the overall growth strategy of Hertz to provide the most flexible transportation programs for corporate and general consumers.
Mark P. Frissora, the Chairman and Chief Executive Officer of Hertz, said, “The acquisition of Donlen is consistent with the evolution of Hertz’s asset-light, technology focused business model and is part of the Company’s overall growth strategy to provide the most flexible transportation programs for corporate and retail customers. Integrating Donlen into the Hertz family of products gives us a yearly and multi-year offering that complements our current core competencies of hourly, daily and monthly car sharing and car rental options and provides the Company with a more stable revenue stream and new adjacent markets to leverage our existing business model.”
With more than 144,000 vehicles under lease and management across the United States, Canada and Mexico, Donlen generates revenue through its high-quality, diversified lease portfolio and its fee-based fleet management and services business. For over a decade, Donlen has posted consistent increases in pre-tax income, a trend that continued throughout the recession in 2008 and 2009. In 2010 Donlen generated gross billings of approximately $920 million and revenues of approximately $350 million. The transaction is immediately accretive to Hertz’s earnings and is EVA positive in year one.
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