Avis buys car club start-up Zipcar in $500m US deal
Wed 02 January 2013
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Avis, the car rental company, has agreed to buy Zipcar for around $500m in a move aimed at expanding its operations in the car-share market. The Boards of Directors of both companies unanimously approved the transaction but it has yet to be approved by shareholders and meet other conditions. It is expected to be completed by Spring 2013.
The Avis Budget Group chairman and chief executive Ronald L. Nelson said: "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.
"We see car sharing as highly complementary to traditional car rental, with rapid growth potential and representing a scalable opportunity for us as a combined company."
If the deal is cleared, Avis plans to run Zipcar as a subsidiary of Avis Budget Group.
The deal will enable Avis to overtake rivals Hertz Global and Enterprise as the largest mobility service provider, beating Hertz’s own car sharing offering, Hertz on Demand.
While some fans of the Zipcar brand fear the buy-out will mean the loss of a unique, independent mobility offering, the firm’s chairman, Scott Griffith assures that the deal will enable the car sharing network to grow and improve.
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