Avis Budget Group Acquires Payless Car Rental For About $50 Mln

(RTTNews) - Avis Budget Group, Inc. (CAR), a provider of vehicle rental services, Monday said that it acquired North American car rental company Payless Car Rental, for about $50 million in cash. Through the deal, Avis expects to secure a strong position in the fast-growing deep-value segment of the car rental industry, and to expand its global footprint. Payless generates approximately $80 million in annual revenue.

Avis Budget intends to operate Payless as a separate brand from a customer perspective, while realizing significant cost savings as a result of the deal, primarily from lower vehicle depreciation, reduced fleet interest expense and administrative cost synergies.

Payless which operates with a hybrid model of corporately operated locations along with locations operated by licensees, brings about 120 rental locations to Avis Budget Group's global network in the United States, Canada, Europe and South America, including many in major airport locations.