Hertz Global Holdings Inc.said it will acquire fleet leasing firm Donlen Corp. for $250 million

Rental car company Hertz Global Holdings Inc. on Sunday said it will acquire fleet leasing firm Donlen Corp. for $250 million, plus $680 million of the company's outstanding debt.

Based in Northbrook, Ill., privately held Donlen leases and manages more than 144,000 vehicles across the United States, Canada and Mexico.

The deal has been approved by both companies' boards and Donlen's stockholders and is expected to close by the end of September. Hertz said it will immediately add to earnings. It has identified $20 million in cost savings, and expects to refinance Donlen's debt at better terms.

The combination will boost Hertz's business in the long-term leasing business, said Hertz Chairman and CEO Mark Frissora. The result will be a more stable revenue stream.

In addition, Hertz said it will be able to significantly expand its fleet management capability to Europe and other international markets.

The acquisition comes as Hertz continues to compete with car rental rival Avis Budget Group Inc. to acquire Dollar Thrifty Automotive Group Inc.

Hertz last week extended its $2.25 billion buyout bid for Tulsa, Okla.-based Dollar Thrifty, which has advised its shareholders against accepting the offer.

The offer now expires on Aug. 5. It includes $57.60 in cash and 0.8546 shares of Hertz stock for each Dollar Thrifty share. The offer was set to expire on July 8. Only about 1 million of Dollar Thrifty's 31.2 million shares had been tendered as of that deadline.


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