NEW YORK, N.Y. -- Cendant Corp., which owns Avis, announced today it has completed the purchase of nearly all of Budget Group's assets. As a result, Cendant is now the second largest car rental company in the U.S., behind Enterprise Rent-A-Car.
The purchase price was $110 million in cash, plus transaction-related expenses and assumption of some contracts and trade payables.
Cendant estimated the total transaction value at between $500 million and $600 million, including cash integration costs. Cendant also agreed to assume $2.5 billion in debt tied to Budget's fleet financing.
The acquisition was approved Nov. 8 by Judge Mary F. Walrath of the U.S. Bankruptcy Court in Wilmington, Del. Budget had been the third largest car and truck rental company in the United States.
The acquisition includes Budget operations and franchised locations in the Americas, Caribbean, Australia and New Zealand and rights to franchise and operate in Asia.
Cendant, through Avis Rent A Car, already operates or franchises Avis car rental locations in the same regions. The transaction does not include Budget Group's Europe, Middle East and Africa operations and franchises.
"Budget is a great strategic fit for Cendant," said John Chidsey, chairman and CEO of Cendant's Vehicle Services Division. "Not only are there operational efficiencies to be achieved with Avis, but Budget is a complementary fit with our other leisure services through Cendant's hotel, timeshare, and travel distribution companies."
Avis and Budget will continue to operate as separate brands.