Regulators approve $2.3 billion deal for Hertz to buy Dollar Thrifty
The Federal Trade Commission required Hertz Global Holdings Inc. to sell off assets in order to close its long-awaited acquisition of Tulsa-based Dollar Thrifty Automotive Group.
Antitrust regulators Thursday approved Hertz Global Holdings Inc.'s $2.3 billion acquisition of Tulsa-based Dollar Thrifty Automotive Group under a settlement that required Hertz to sell locations at airports across the nation.
Hertz CEO Mark P. Frissora said the “compelling settlement” with the Federal Trade Commission clears the way for the acquisition of Dollar Thrifty, a goal Hertz sought for more than two years.
“We have always believed that a combination with Dollar Thrifty is the best strategic option for both companies, and we look forward to becoming a stronger global competitive player in the industry,” Frissora said in a statement. “We are confident that the employees, customers and shareholders of both companies will benefit from the value this combination will create.”
Dollar Thrifty has nearly 800 employees in Tulsa. Hertz employs about 1,700 in Oklahoma City. Hertz earlier said it would evaluate staffing and operations at the two cities after the merger.
The transaction ends a long courtship of Dollar Thrifty by Hertz that also included competing bids from industry leader Avis, which eventually dropped out of the process. Hertz had considered Dollar Thrifty a target as far back as 2007, but the 2008 economic collapse battered the rental car business and nearly brought down Dollar Thrifty.
In early 2009, Dollar Thrifty shares sold for less than $1 a share as management negotiated with creditors while simultaneously preparing for a potential bankruptcy. The company struck deals with lenders, reworked a supply contract with Chrysler, and the stock price came roaring back along with the travel business.
The deal combines Hertz's premium market with Dollar Thrifty's value business. Hertz, in a news release, said the combination will allow Dollar Thrifty to expand its value leisure-focused brands in key car rental markets around the world, while providing Hertz instant scale with the Dollar and Thrifty brands with airport concessions in the value segment.
Hertz's tender offer of $87.50 per share is scheduled to close Friday. That's more than double what Hertz offered in 2010, a bid that was rejected by Dollar Thrifty shareholders.