VW in Talks With Europcar About Sweetened Offer for Car Renter

VW Said to Move Closer to Europcar Deal After Sweetened Bid

28 Jul 2021, 12:58 PM IST

(Bloomberg) -- Volkswagen AG is moving closer to a deal to buy Europcar Mobility Group after sweetening its offer for the car renter.

Europcar is in talks with a consortium led by the German carmaker about a possible takeover at a price of 50 euro cents per share, the company said in a statement Tuesday, confirming an earlier Bloomberg News report. The bid would value the company at around 2.5 billion euros ($3 billion).

Europcar shares rose as much as 5.4% on Tuesday and closed up 3.7% to 49 euro cents in Paris.

There’s no certainty as to the outcome of the discussions, Europcar said. Negotiations are particularly complex given there are about 10 different stakeholders involved, including more than half a dozen hedge fund investors in Europcar, people familiar with the talks said earlier.

VW’s previous offer with its partners Attestor Ltd. and Pon Holdings BV of 44 euro cents a share was rejected about a month ago by Europcar as too low. A bid of 50 cents a share would be a premium of 27% to Europcar’s share price on June 22, the day before Bloomberg News first reported on the initial bid.

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VW is interested in gaining access to Europcar’s infrastructure and technology in a bet on the future of mobility services. While demand for rental cars has recovered as governments loosen virus-related restrictions, companies in the sector face long-term challenges from newer entrants offering ride-hailing and car-sharing.

Representatives for VW and Pon declined to comment, while spokespeople for Anchorage, Attestor and Marathon couldn’t immediately be reached for comment.

If a deal is agreed, it would mark a reversal of sorts. VW took over Europcar in the late 1990s, then sold it to buyout firm Eurazeo SE in 2006 for 1.26 billion euros.

Late last year, Europcar agreed to a debt restructuring and capital increase that wiped out more than 1 billion euros of debt and handed control of the company to several hedge funds including Anchorage Capital Group and Marathon Asset Management.