Zipcar has amassed a whole lot of fame and popularity as a car sharing service. In the car sharing niche, Zipcar is certainly among the very few names that have made it big. In a recent statement released by both Avis and Zipcar, the former has acquired the company.
Zipcar is among the leading car sharing services in the U.S. The company currently has a user base of 760,000 and and has a presence in 20 major metropolitan areas of the country.
It has now reached an agreement with Avis Budget Group according to which, Avis will be acquiring Zipcar for $12.25 per share. The amount owed against the total shares will be paid in cash. The deal is certainly sweet since Zipcar’s share price currently stands at $8.24 which means that Avis is paying a 49% premium over the current stock price.
According to the chairman of Avis Budget Group, Ronald L. Nelson, “By combining with Zipcar, we will significantly increase our growth potential, both in the United States and internationally, and will position our Company to better serve a greater variety of consumer and commercial transportation needs.”
The company plans to reinforce the Zipcar brand by expanding its presence to more areas and intends to leverage its technology to put Avis and Budget brands into greater momentum. The company also hopes that the acquisition will help it significantly trim down its own costs by letting the Avis fleet be utilized under the Zipcar brands to enhance the service’s portfolio.
Zipcar seems quite happy with the deal and the company’s chairman, Scott Griffith says, “We are delighted to announce our intention to join the Avis Budget Group family of companies, and we believe this combination is a win across the board for our members, shareholders and employees. We will be well positioned to accelerate enhancements to the Zipcar member experience with more offers and additional services as well as an expanded network of locations.”
Courtesy: Business Insider