Hertz Said to Gauge Dollar Thrifty Shareholders on Bid Price
Hertz (HTZ) Global Holdings Inc., which has been trying to acquire Dollar Thrifty Automotive Group Inc. (DTG) for more than two years, has begun soliciting Dollar Thrifty shareholders to gauge their selling price, according to three people with knowledge of the process.
Hertz has contacted some Dollar Thrifty investors in recent weeks to determine at what price they would sell, said the people, who asked not to be identified because the talks are private. Hertz also asked investors if a hostile bid should be pursued, said one of the people. The companies are in the early stages of negotiating an acceptable offer, two of them said.
Hertz, which reaffirmed last month it wants to buy Dollar Thrifty, is trying to sell its Advantage unit to satisfy U.S. antitrust concerns. The Federal Trade Commission won’t issue a consent decree until the companies have agreed to terms, a person familiar with the process said. Hertz has begun talks with potential lenders in anticipation of preparing a bid for Dollar Thrifty within weeks, said another person.
Dollar Thrifty shareholders rejected Hertz’s 2010 bid to buy the company for about $1.2 billion. Hertz made another offer last year that it later withdrew, citing market conditions. Dollar Thrifty contacted Avis (CAR) Budget Group Inc. last month to solicit a new offer, a person with knowledge of the matter said at the time. Parsippany, New Jersey-based Avis ended its previous pursuit of Dollar Thrifty in September 2011.
Dollar Thrifty’s market value is about $2.1 billion. Avis made its initial bid for Dollar Thrifty in July 2010 before sweetening it to about $1.52 billion two months later. Dollar Thrifty traded below $1 in March 2009.
Avis pulled its previous offer because it deemed Tulsa, Oklahoma-based Dollar Thrifty too expensive and decided not to pursue another bid for the same reason, according to the person familiar with the situation.
Anna Bootenhoff, a spokeswoman for Dollar Thrifty, and Richard Broome, a spokesman for Park Ridge, New Jersey-based Hertz, declined to comment.
Dollar Thrifty rose 3.7 percent to $78.50 at 9:53 a.m. in New York, the biggest intraday jump in three weeks. The shares rose 7.8 percent this year through yesterday. Hertz gained 4.7 percent to $12.98. Avis rose 1.2 percent to $16.15.
To contact the reporters on this story: Mark Clothier in Southfield, Michigan at email@example.com; Zachary R. Mider in New York at firstname.lastname@example.org; David Welch in Chicago at email@example.com