PARSIPPANY, N.J. - Avis Budget Group, Inc. announced that shareholders of Avis Europe plc have voted overwhelmingly to approve Avis Budget Group's proposed acquisition of Avis Europe. The acquisition is expected to close in early October, subject to regulatory clearances and final court approvals.
Avis Budget Group also announced today that its lenders have approved an amendment of the Company's principal credit facility that will allow it to acquire Avis Europe as an indirect subsidiary of its existing operating subsidiary, Avis Budget Car Rental, LLC. Based on current market conditions, this amendment is expected to allow the Company to access lower-cost financing for the acquisition and to permit the Company to complete the acquisition of Avis Europe without issuing any equity securities.
"We are pleased to be making progress on all fronts toward our planned acquisition of Avis Europe," said Ronald L. Nelson, Avis Budget Group Chairman and Chief Executive Officer. "The approval of the transaction by Avis Europe shareholders is a key milestone, and we are moving forward expeditiously on our financing strategies and integration planning. Our expectation that we will be able to finance the acquisition without issuing equity further enhances the attractiveness of the transaction from a financial perspective."
Formal closing of the credit facility amendment, which has already been approved by the requisite number of lenders, is expected to occur in August. The Company also expects that the acquisition of the outstanding shares of Avis Europe, repayment of certain outstanding Avis Europe debt, and transaction fees and expenses in aggregate will require approximately $1.8 billion in funding, which the Company intends to provide through cash on hand and the issuance of approximately $1.1 billion in new debt.
As previously announced, Avis Budget Group intends to announce its second quarter 2011 results after the market close on August 3, and to host a conference call to discuss second quarter results at 9:00 a.m. (ET) on August 4.
The revenue increase was driven primarily by a higher net revenue margin associated with two new subscription tiers launched in the second quarter.