The wonderful world of carsharing doesn’t often experience a whole lot of what one might describe as “big news,” but this today’s one of those days where something actually appears to be afoot. Avis, the car rental company, is set to acquire Zipcar, the carsharing company, for $12.25 per share in cash. As in, around $500 million. Not everything’s been sunshine and rainbows for Zipcar, and their stock has dropped significantly since their IPO. Even so, some shareholders don’t appear to be too happy about the acquisition.
Avis and Zipcar, on the other hand, seem to be pretty pleased with the whole thing. Adding the fleet of cars that Avis has at its fingertips to the impressive service of Zipcar just seems like a good idea all around. According to Ronald L. Nelson, chairman and CEO of Avis Budget Group, Zipcar should pretty much remain Zipcar:
We expect to apply Avis Budget’s experience and efficiencies of fleet management with Zipcar’s proven, customer-friendly technology to accelerate the growth of the Zipcar brand and to provide more options for Zipsters in more places. We also expect to leverage Zipcar’s technology to expand mobility solutions under the Avis and Budget brands.
On the other hand, some shareholders feel like that $12.25 per share is a steal. Powers Taylor, a securities litigation firm, and former U.S. Securities and Exchange Commission attorney Willie Briscoe will be investigating and potentially filing a lawsuit to stop the sale because of it. This all stems back to the fact that the $12.25 being offered per share is below the 52-week high of $16.25.
It’s pretty unlikely that any lawsuit will actually prevent Avis from buying Zipcar, but it might prolong the process. Considering Zipcar’s pretty poor stock price record, it’s not like the offer is completely unreasonable. People that lost money are always going to be upset that they lost money.
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