Avis Budget Group, of Parsippany, announced today it has acquired Payless Car Rental in an all-cash deal valued at approximately $50 million.
According to an announcement from Avis, Payless is the sixth-largest car rental company in North America, and generates some $80 million in annual revenue.
Avis said in its announcement that its interest in St. Petersburg, Fla.-based Payless comes from the company’s presence in the deep-value segment of the marketplace, and will complement Avis’ premium brand and its mid-tier Budget business.
Payless, which was founded in 1971, will bring about 120 rental locations to Avis in the United States, Canada, Europe and South America.
It’s been a busy time for the two car-rental giants who are presently based in New Jersey. Avis got into a bidding battle with its chief competitor, Hertz Global Holdings, of Park Ridge, for Dollar Thrifty Automotive Group. Last week, the Federal Trade Commission gave its final approval to Hertz’s $2.6 billion takeover of the Tulsa, Okla. company.
Hertz said in May it would be relocating its headquarters to Florida.
Avis said in its announcement it intends to operate Payless as a separate brand, but said it will draw cost savings as a result of lower vehicle depreciation, reduced fleet interest expense and administrative cost overlap.