Avis Owner Cendant Assumes Budget Group

A Wilmington, Del., bankruptcy court on Friday awarded all assets of Budget Group Inc. to Cendant Corp., a company that owns Avis Rent-A-Car. The sale will add all of Budget's American, European and Australian assets, as well as some in Asia, to Cendant's portfolio.

Cherokee Acquisition Corp., founded by Cendant, will pay $110 million in cash and assume liabilities that include $100 million owed to Ford Motor Co. and $72 million owed to Nissan Motor Co. Budget expects the sale to close by Nov. 22.

Car rental market analysts said a consolidation of back-office and administrative functions is likely, as well as a possible integration of reservations systems, though Cendant has made no indications it would consider merging the brands themselves.

In a report issued last month, Abrams Travel Data Services vice president and director of research Jon LeSage expected Cendant to capitalize on Budget's large spread of local market locations in order for Avis to focus on its "core business travel audience," while pursuing cross-market opportunities for Budget within its mid-market and discount lodging brands.