Hertz CEO Mark Frissora may finally be done kicking the tires at Dollar Thrifty.
Hertz, the car-rental giant based in Park Ridge, NJ, yesterday was close to a deal to acquire rival Dollar Thrifty for more than $2.5 billion, according to sources.
Insiders said Hertz is looking to buy Dollar Thrifty for $87.50 a share — a premium of more than 7.4 percent to Friday’s closing price of $81.
Talks have heated up in recent weeks after Dollar Thrifty CEO Scott Thompson in July called Hertz’s bluff after months of delays. “It is time for a compelling offer to be made or for this process to come to a close,” Thompson said.
According to sources, Thompson’s comments came after both companies had been notified the merger had gained preliminary approval by the Federal Trade Commission.
The FTC would officially bless the deal only if a fresh offer was made, according to a person close to the situation.
Hertz, with second-quarter revenue of $2.2 billion, reaffirmed last month it still wanted to buy the smaller Dollar Thrifty, and in recent weeks has been dialing Dollar Thrifty shareholders, asking at what price they’d be willing to sell, according to sources. Dollar Thrifty had revenue of $395 million in the second quarter.
Meanwhile, Hertz has been in talks to sell its Advantage car-rental unit in order to satisfy antitrust concerns.
A Hertz-Dollar Thrifty combination could reap as much as $150 million in cost savings. However, some insiders fear a merger could threaten jobs at New Jersey-based Hertz, which has 23,900 workers.
A merger is looming after more than two years of on-again, off-again talks, which began in 2010 when Hertz offered $1.2 billion for Dollar Thrifty — a bid that was swiftly rejected.
Last year, Hertz made an offer of $2.2 billion but then withdrew it, citing bumpy market conditions.
Last month, sources said Dollar Thrifty reached out to Avis Budget, which had weighed a possible merger last year after bidding more than $1.5 billion in 2010. But Avis gave up on the idea in 2011, opting to merge with Avis Europe instead.