Avis Planning 250M in New Notes
February 25, 2013
Avis Budget Group is planning to sell €250 million ($330 million) in senior notes due 2021. The company plans to use the proceeds to help finance its acquisition of Zipcar.
Citigroup, Credit Agricole, Deutsche Bank and JPMorgan are the bookrunners. The banks are planning to launch a roadshow Tuesday and could price the notes by Thursday, Feb. 25.
The Parsippany, N.J.-based car rental company is also seeking a $900 million seven-year term loan underwritten by JPMorgan to help finance the Zipcar buy. Price talk on the loan is at 275 bps over Libor and is set to be sold at par.
The proceeds will be used to help refinance Zipcar’s outstanding term loan debt. It has $689 million in outstanding term loan C debt.
Avis agreed to purchase car sharing network Zipcar for $12.25 per share in cash on Dec. 31, Avis said in a press release. The total amount of the transaction is roughly $500 million, but Avis is also refinancing Zipcar’s existing debt.
Moody’s Investors Service is expected to rate the bonds B2 and Standard & Poor’s will likely give a B rating to the notes.