LOS ANGELES -- MAII Holdings Inc. announced plans for one of its subsidiaries to purchase Car Rental Direct.com, a wholly owned subsidiary of GenesisIntermedia Inc. The closing of the sale, however, is still subject to review by MAII's financial advisors.
If the sale is completed, GenesisIntermedia will receive approximately $11.6 million in cash. Separately, GenesisIntermedia has entered into agreements to acquire an aggregate 2,812,483 of MAII's common shares outstanding for $4 a share, following completion of the merger and certain other conditions.
In addition, GenesisIntermedia intends to purchase more shares in the open market, the company said. Following the merger and shareholder approval, the newly combined entity will be renamed Car Rental Direct.
"We've accomplished what we initially set out to do with Car Rental Direct," said Ramy El-Batrawi, chairman and CEO of GenesisIntermedia Inc. "We purchased CRD early in its lifecycle and developed it into a company that stands ready to make its imprint on the replacement segment of the car rental market. With CRD operating on its own, it will not place further cash requirements on GenesisIntermedia. With its revenue growth of 130% in the second quarter of this year over the prior year's second quarter, we anticipate its revenues will grow another 100% over the next 12 months and for it to achieve profitability by year end."
