Budget Secures Fleet Financing, Continues European Reorganization

Budget Group Inc. has secured a $350 million asset-backed financing facility to acquire more vehicles during its peak rental season.

Earlier this year, Budget received an amendment to its revolving credit facility used to finance its fleet. The amendment restored credit availability up to $550 million.

Budget is also undertaking a placement of $400 million of asset-backed medium term notes. The company said it expects the placement to be completed in mid-April. These and other fleet financing measures will replace debt that matures over the next several months.

Budget also recently completed the sale of its Birmingham and Manchester locations in England to a franchisee, and refranchised nearly all of its corporate French locations.

Budget Rent a Car International said it has negotiated agreements with a number of investors, nearly all of whom are current Budget franchisees. When the transactions close in April and May, this will transform France into a 90% franchised operation, Budget said.

“This restructuring program mirrors what we have already implemented in the U.K. and are now starting in other European corporate locations,” said Jack Frazee, president and chief operating officer of Budget Rent a Car International. “The investors we have secured for the expanded regional franchises were se-lected on the basis of their industry expertise, local market knowledge and strong focus on high levels of customer service.”

Meanwhile, Budget will retain corporate control of select locations at the Paris and Nice gateway airports, as well as Paris railway stations and downtown locations.

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