Bringing to an end one of the more protracted takeover sagas of recent times, Hertz has completed its acquisition of rival Dollar Thrifty.
The deal follows a recent plea from Dollar Thrifty for an end to the merger process, which has rumbled on for nearly two years.
Hertz will pay $87.50 a share for the company valuing the company ay $2.3 billion; more than double the price it first offered two years ago.
The deal closes a five year chase for Hertz chief Mark Frissora and is expected to be the last major consolidation permitted by regulators in the United States.
Rival Avis had previously been keen to acquire Dollar Thrifty, but was outbid by Hertz.
Three companies – Hertz, Avis and Enterprise Holdings, owner of the Alamo, National and Enterprise brands – now control 95 per cent of the US car hire market.
Frissora said: “We are pleased to have finally reached an agreement with Dollar Thrifty after a lengthy – but worthwhile – pursuit.
“We have always believed that a combination with Dollar Thrifty is the best strategic option for both companies.
“The transaction provides Hertz instant scale with two new, well-established brands with airport concession infrastructure in the mid-tier value segment.”
The transaction has been structured as a two-step acquisition including a cash tender offer for all outstanding shares of Dollar Thrifty common stock followed by a cash merger in which Hertz would acquire any remaining outstanding shares of Dollar Thrifty common stock.
The transaction is subject to the tender of at least a majority of the shares of Dollar Thrifty common stock, as well as other customary closing conditions.
The successful completion of the transaction is also subject to regulatory clearance by the Federal Trade Commission.
Hertz has remained closely engaged with the FTC to secure antitrust clearance for the proposed transaction and Dollar Thrifty will fully cooperate in the process.
Hertz also announced today it has reached an agreement to sell the Advantage business to Franchise Services of North America and Macquarie Capital.
FSNA is an experienced rental car operator with subsidiaries including, among others, U-Save, Rent-a-Wreck, Practicar and X Press Rent-a-Car.
The closing of that divestiture is conditioned upon, among other things, Hertz completing an acquisition of Dollar Thrifty.