Ford Reportedly Agrees To Sell Hertz

Ford Motor Co. yesterday agreed to sell its Hertz Rent-A-Car unit to a group of investors including Clayton, Dubilier & Rice, Carlyle Group and Merrill Lynch Global Private Equity, according to published reports. The investment firms would purchase Hertz for up to $6 billion, while assuming more than $10 billion in debt, reports said.

Neither Ford nor Hertz would comment on the deal and, as of press time, Ford had yet to submit a filing with the Securities and Exchange Commission. However, the company since April publicly has discussed the possibility of selling the rental car unit or launching an initial public offering to once again spin it off. In the past decade, Ford has had an on-again, off-again ownership of the rental car firm and in 2001 acquired all outstanding shares of Hertz.

Hertz, which Ford said operates the largest general-use rental business in the world, earlier this year reported a record net income of $365 million for 2004 and has maintained momentum throughout 2005. For the first quarter of 2005, Hertz reported a $33 million pre-tax profit, a drastic improvement from a $7 million pre-tax loss recorded for the same period last year.