In light of Avis Budget’s recent $500 million acquisition of Zipcar, Felix Salmon at Reuters argues that Avis is a clear winner in the game of mergers and acquisitions.Here’s why:
- Hertz’s hefty $2.6 billion acquisition of Dollar Thrifty saved Avis $1.5 billion, since Avis lost the deal to Hertz. It also minimized the number of competitors in the market.
- Zipcar’s market cap fell from $1.2 billion to $330 million at the end of 2012, while Avis’ stayed strong at $2.1 billion, “making an acquisition both easy and obvious.”
- Zipcar is the leader in the car-renting space at a time when there’s becoming less of a need for households to own a car.
- Zipcar has a better reputation than both Avis and Budget.
- It’s also much easier to rent from Zipcar than it is from Budget.
Read the full story here on Reuters.