Bloomberg News

Dollar Thrifty Falls After Avis Agrees to Buy Avis Europe

June 14, 2011

(Updates share trading starting in the first paragraph.)

June 14 (Bloomberg) -- Dollar Thrifty Automotive Group Inc. fell the most since 2009 in New York trading after suitor Avis Budget Group Inc. agreed to acquire Avis Europe Plc for $1.04 billion, leaving investors to wonder if Avis could buy both companies.

Dollar Thrifty slid $7.44, or 9.3 percent, to $72.43 at 4:15 p.m. in New York Stock Exchange composite trading, the biggest one-day drop since October 2009. Avis said today that while it will continue to monitor Dollar Thrifty, its “focus squarely will be on completing and integrating” the Avis Europe acquisition.

Avis and Hertz Global Holdings Inc. have been bidding for Dollar Thrifty since April 2010. The Federal Trade Commission has been reviewing Avis’s $1.65 billion, or $57.02 a share, bid since October. The agency is also looking at Hertz’s May offer, valued at $2.05 billion, or $70.76 a share.

“If you’re a Dollar Thrifty shareholder looking for a bidding contest, this doesn’t inspire much confidence,” Fred Lowrance, an analyst with Avondale Partners LLC in Nashville, Tennessee, said in an interview. “Maybe they could get it done financially, but you don’t want to take down two massive acquisitions at one time.”

--Editors: Jamie Butters, John Lear

To contact the reporter on this story: Mark Clothier in Southfield, Michigan, at mclothier@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net


Tim Cook's Reboot
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus