On Aug, 2, Ecologic Transportation Inc. (EGCT) entered into a Letter of Intent (LOI) for an “Agreement to Acquire One Hundred Percent of the Issued and Outstanding Shares of Ace Rent A Car Inc,” according to an Aug. 13 press release.
Ace has an affiliate network comprising more than 200 locations with 89 of them in strategic U.S. markets. In addition, Ace operates an independent reservation system that serves its affiliates and itself, which would allow EGCT to rent its environmentally friendly cars from any location worldwide.
EGCT’s agreement with Ace is to purchase all aspects of the business, its wholly-owned locations, its affiliate marketing system and the reservation system. The Ace “back office,” and reservations and management systems are fully scalable with secure off-site file storage and functional capacity.
Formed to serve a growing consumer demand for a “pure environmental” car rental company, EGCT states that its business plan calls for it to acquire multi-regional independent car rental companies, consolidate their operations and brands, introduce economy of scale efficiencies into their sales and operations, and expand market share through the strategic leveraging of the unique market position as the only “pure green” multi-geographic car rental company in the world.
The company and its management believe that Ace is uniquely positioned to provide the platform and culture of excellence for its strategic growth plan. Ace will serve as EGCT’s operational and management base for the expansion, and its model for award-winning customer service and the green transition. As the company adds acquisitions, EGCT will use Ace staff and its customer service model to train and oversee the transition and on-going service commitment, for which their reputation is nationally known.
Ace is a 46-year-old, Indianapolis, Indiana and Chicago, Ill.-based car rental company that generated gross revenue of $69 million for the year ending March 31, 2012. Ace Rent A Car ranked “Highest in Car Rental Customer Satisfaction” by J.D. Power and Associates in 2011 and, additionally in 2012, Ace was named one of 50 J.D. Power Customer Service Champions across 20 service industries.
Ace generates its revenue from four operating units consisting of car rental, car sales, airport parking and reservation system. ACE’s largest operation is its new 7-acre facility at O’Hare International Airport in Chicago, and it also has car rental operations in the greater Chicago, Illinois, Indianapolis, Indiana, Minneapolis, Minnesota and Austin, Texas areas.
The Ace management has spanned two generations of the same family since it opened its doors, and is now in the hands of Richard (Dick) Radzis, president, and Charles Mullin Sr., VP operations and fleet, with Julie Ray, CPA, as the CFO. These industry veterans will stay with the company and help to not only keep it profitable and customer oriented, but work to develop the successful “green” model and service excellence component, according to the press release.
The ACE reservations systems, its “Back Office” functions and fleet management systems represent a seamless entry into expansion and the evolution to a totally ecologic-based fleet and rental experience.
"I am very excited about bringing together the operations, reservation technology and the culture of Ace with the wisdom, experience and creativity of Ecologic Transportation,” Radzis said. “This transaction will bring together non-competing components that collectively will add value to the other and in doing so will stage a solid and robust business model.”
Ecologic’s Chairman and Founder Edward W. Withrow III said “the Board and management of Ecologic Transportation are extremely pleased to have the opportunity to work with the caliber and experience level of the management and staff of ACE, and look forward to working with them to build a new and superior business model for the car rental industry.”
Headquartered in Santa Monica, Calif., Ecologic Transportation Inc., is a holding company with wholly-owned subsidiaries all dedicated to environmentally friendly transportation products and services. The company encompasses two separate but integrated operations that address the environment and transportation holistically: Ecologic Car Rentals and Ecologic Products.
