Hertz Off and Running on Acquisition Talk
Hertz (NYSE:HTZ) shares are swooping north today, posting gains of 9.56% at last price check. The rush on stocks of the car and equipment rental company comes with news that its plans to buy out lagging competitor Dollar Thrifty (NYSE:DTG) will be smooth sailing from here on.
Hertz had been thrown into a bidding war over Thrifty with competitor Avis Budget Group (NYSE:CAR), with Avis placing a recent bid for the company of $1.63 billion, prompting a response bid from Hertz of $2.02 billion. Talk of the bid-up aggression is subsiding today though, as Avis announced that it is done pursuing Dollar Thrifty, and has decided to use the cash to purchase Avis Europe instead (for $1.03 billion).
Avis’ turn of the head will ostensibly clear the way for Hertz, as according to one analyst, “It increases the likelihood that Hertz’s recent exchange offer of approximately $72/share cash and stock offer is successful, subject to regulatory approval.”
Shares of Dollar Thrifty are taking a beating today on the news, down almost 9% at last check, while Avis is posting gains of 4.75%. How about Avis Europe? The small cap stock is up an eye-popping 57%.
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