PHH Vehicle Management Services announced today that a definitive agreement has been signed by which PHH Vehicle Management Services will join Avis Rent A Car, Inc. (NYSE: AVI) as a wholly owned subsidiary. Avis acquisition from Cendant Corporation includes PHH, PHH Europe (which includes Cendant Business Answers and the Harpur Group Ltd.), and Wright Express Corporation in a transaction valued at $1.8 billion. The transaction is subject to standard regulatory review and approval, which is expected to proceed quickly toward a closing in 30 to 45 days.
! Commenting on Avis acquisition of PHH, Mark Miller, PHH Chairman and CEO, said, We have an extraordinary opportunity to build a powerful new enterprise focused on fulfilling the total automotive transportation needs of our clients. We believe we can capitalize on a host of major synergies offering significant new revenue growth — synergies that will have a great appeal to our clients and shareholders. In addition, we will retain the high-value PHH brand name in both North America and Europe, as well as our people, locations, management and culture. Our leadership position in the fleet management, card services and related industries will not only be strengthened but expanded.
Avis annually completes approximately 15 million rental transactions with a fleet averaging approximately 200,000 vehicles, generating about $2.3 billion in total revenue. The newly expanded company will purchase over 350,000 vehicles per year and provide over three million commercial cards, surpassing the size and scope of any competitor. The total combined fleet will exceed one million units worldwide.
Other areas of synergy include leveraging of information technology capabilities, cross-sales of short- and long-term vehicle- and transportation-related services, used vehicle sales, maintenance management, and front-line strategies for promoting card services in the travel and transport sector. Joining Avis also enhances PHHs global presence and ability to reach new client groups and offer new services to existing clients.
Joining forces with Avis will have tremendous positive impact on the future growth of our business, says Mark Miller. There are no competitive obstacles to overcome only great opportunities for even better service to our clients, expanded career development for our employees, broader opportunities for our suppliers, and increased earnings for shareholders.
Founded in 1946, PHH Vehicle Management Services is a leading global vehicle management company. PHH manages the vehicles of nearly one-third of the Fortune 500 companies, and its total fleet exceeds 700,000 vehicles across North America and Europe.