Avis Budget on Thursday once again upped its offer in the
bidding war to acquire Dollar Thrifty Automotive Group as shareholders prepare
to vote on the competing offer from Hertz next week.
Avis Budget’s later offer boosts the cash portion of its
offer from $40.75 per share to $45.79 per share, along with 0.6543 share of
Avis Budget stock. Avis Budget shares opened on Thursday at $10.85 per share,
which boosts the total offer to almost $53 per share, or about $1.6 billion.
Hertz on Sept. 13 raised its offer to $50 per share, or
about $1.56 billion.
“Our revised offer represents a meaningful premium over the
revised offer from Hertz Global Holdings,” Avis Budget said in a statement
issued on Thursday. “We believe that the increased value is warranted based on
improving fundamentals in the industry and at Dollar Thrifty in particular.”
Shareholders are slated to vote on whether to approve
Hertz’s offer on Sept. 30, but Avis Budget urged Dollar Thrifty to postpone the
vote until the U.S. Federal Trade Commission completed a review of both offers.
While Hertz has said an Avis Budget/Dollar Thrifty deal would have a tougher
time getting regulatory clearance—and Hertz plans to divest the low-cost
Advantage Rent A Car business it acquired last year to better its chances for
approval—Avis Budget on Thursday said that it’s the Hertz deal that faces the
tougher antitrust road.
“A number of airports will become highly concentrated if
Hertz acquires Dollar Thrifty,” according to the Avis Budget statement. “A sale
by Hertz of its Advantage brand—a trivial operation that has no presence at
several dozen airports—is by itself unlikely to be a meaningful or sufficient
remedy for any antitrust issues.”