PARSIPPANY, N.J. — Car rental company Avis Budget Group said Thursday that it is raising the cash portion of its bid for Dollar Thrifty as it battles Hertz for the potential buyout.
Avis said it will increase the cash component to $40.75 per share from its previous offer of $39.25 per share. The bid includes 0.6543 shares of Avis Budget Group Inc. stock per share of Dollar Thrifty stock.
Avis contends its new offer is more than a 22 percent premium over Hertz Global Holdings Inc.’s bid, which was valued at $1.17 billion.
Avis’ former cash-and-stock offer was valued at $1.33 billion.
Dollar Thrifty has a special shareholders meeting planned for Sept. 16 so its stockholders can vote on Hertz’s bid.
But Avis said it will increase its offer to Dollar Thrifty shareholders if the Hertz deal doesn’t go through, boosting the bid by the amount of any reduction in the Dollar Thrifty break-up fee payable or paid to Hertz.
Dollar Thrifty shares rose 56 cents, or 1.2 percent, to $48.05, while Avis shares gained 42 cents, or 4.3 percent, to $10.17 and Hertz shares added 38 cents, or 4.2 percent, to $9.47.
Dollar Thrifty Automotive Group Inc., based in Tulsa, Okla., has favored working out a deal with Hertz, rebuffing a counteroffer from Avis last month.
Dollar Thrifty has been concerned Avis may not get the approval of antitrust regulators and has been unhappy that Avis has been unwilling to offer a so-called “reverse termination fee.”
But Avis, headquartered in Parsippany, said Thursday that a reverse termination fee “has nothing to do with certainty of closing.”
“The Hertz deal is no more likely to be approved by the Federal Trade Commission simply because Hertz agreed in the context of a negotiated deal to pay a fee to Dollar Thrifty if it is not approved,” Avis said.
