Acquisitions continue abundantly in the car rental business. Avis Budget Group Inc. just purchased Payless Car Rental for about $50 million in cash. Payless has about 120 locations in North America, South America, and Europe and produces about $80 million in annual revenue. Avis can benefit from the discount car rental marketing identity that the Payless brand brings to the table. Avis is also competing for market share, and witnessed Hertz achieve regulatory approval recently for its $2.3 billion purchase of Dollar Thrifty Automotive Group.
The Payless purchase price was only 10% what was paid for Zipcar Inc., the largest car sharing company. In March, Avis acquired Zipcar for about $500 million.
Car and ride sharing is taking off with car rental companies. Enterprise Holdings just acquired Zimride, an online ride-matching service. Zimride has more than 350,000 ride-matching users on colleges and universities; the financial agreement wasn’t disclosed. Hertz would like to make its Hertz 24/7 car sharing division the largest car sharing service in the world.
