Dollar Thrifty Automotive Group Inc. (DTG), the car-rental company that was the target of bidding by two competitors, delayed by one year the expiration of a shareholder provision intended to prevent a hostile takeover.
Dollar Thrifty’s shareholder rights plan will expire May 30, 2013, the Tulsa, Oklahoma-based company said today in a statement. No changes were made to the plan implemented May 18, which allows other shareholders to buy Dollar Thrifty at a 50 percent discount if an investor acquired at least 20 percent of the shares or adds to an existing 20 percent holding without board approval.
Dollar Thrifty, the fourth-largest U.S. car-rental company, said in October it planned to operate independently after being the target of bidding by Hertz Global Holdings Inc. (HTZ) and Avis Budget Group Inc. (CAR) The company said Feb. 9 it completed a $100 million stock-repurchase agreement, buying 1.45 million shares at an average price of about $68.91.
“Our board believes that it would be imprudent and inconsistent with its fiduciary duties not to maintain the protections of the rights plan as we monitor the actions of our competitors,” Scott Thompson, Dollar Thrifty’s chief executive officer, said in the statement. “The scarcity value of our long-established brands, unleveraged capital position and cash rich balance sheet requires protection.”
Dollar Thrifty rose 2.3 percent to $75.05 at 9:47 a.m. New York time. The shares gained 4.4 percent this year through Feb. 17.
The company separately reported that fourth-quarter net income more than doubled to $33.9 million, or $1.08 a share, from $12.5 million, or 41 cents, a year earlier.
Excluding costs its considers one-time items, Dollar Thrifty reported a profit of $1.09 a share. The average estimate of six analysts surveyed by Bloomberg was for a profit of 75 cents a share.
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