Under Avis, Zipcar will face a number of other car-sharing services, some looking to take even more radical approaches, such as RelayRides. That is still a significant decline from the strike price of $18 a share for Zipcar stock during its April 2011 IPO. It could lead the car-sharing company to expand into other metropolitan markets.Īvis itself sees the opportunity to save between $50 million and $70 million through the acquisition – for which it will pay $12.25 for Zipcar shares, a 49% premium over the Decemclosing price of $8.24. It could ease pressure on Zipcar on weekends and other occasions when it struggles to maintain a large enough fleet to meet demand. Zipcar has so far spread into 20 metropolitan markets in the U.S., Canada and Europe.Īvis said it expects significant “synergies” as part of the deal. The challenge for many of the new competitors in the field has been to raise capital to expand, industry experts note. last year announced a partnership that placed hundreds of new Ford Focus models on campuses around the country, an alliance the maker hoped would eventually convince students to buy the car once they graduated. The car-sharing concept has begun to revolutionize the rental business, attracting young and often affluent buyers, especially in urban areas and around college campuses.
“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,” Avis Chairman and CEO Ronald Nelson said in a statement accompany the Wednesday morning announcement. The Detroit Bureau: Ford Focus Expected to Be #1 Best-Seller for 2012
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