Dollar Thrifty Gets Higher Bid

Dollar Thrifty Automotive Group has received a higher bid from Avis Budget Group. The group had previously made a $1.3 billion bid for the car hire company, which was a $45.79 per share value. Now they are offering $1.52 billion, increasing the cash portion of the bid 12% and maintaining the 0.6543 stock portion, which values the company at $53 per share.

This now tops the $1.44 billion offer from Hertz Global Holdings, which is also an increased bid and values the company at $50.25 per share. Dollar Thrifty has already agreed to the offer from Hertz, and their shareholders are set to vote on it September 30. Due to this accepted bid, Hertz has already started unloading its Advantage Rent-a-Car brand so that regulators will be more inclined to approve a merger between the two companies.

A merger between Dollar Thrifty and Hertz is favored more throughout the industry, as the budget brand would be a great compliment to the business-focused company. Avis Budget caters to both business and leisure customers, so there is a higher probability that competition would be distorted if they controlled too much of the leisure market.

Meanwhile, Hertz has expressed that they won’t budge from their most recent offer, calling it their best and final bid. Chief executive Mark P. Frissora says that their deal with Dollar Thrifty offers their shareholders a substantial premium and a clear path to close the deal by the end of the year. They have made their last offer and believe it’s in the best interest of the shareholders to vote in favor of the transaction, he added.