Avis Budget Group Announces Pricing of $500 Million of Senior Notes

Rhea-AI Summary

Avis Budget Group announced a $500 million offering of 4.75% senior notes due 2028, increasing from a previously planned $350 million. The offering is set to close on March 23, 2021. Proceeds will be used to redeem 6.375% senior notes due 2024 and 5.250% senior notes due 2025, along with covering related expenses. The notes are available only to qualified institutional buyers under Rule 144A and are not registered under the Securities Act. Avis Budget Group is a global provider of mobility solutions with over 10,000 rental locations worldwide.

Positive

• Successful increase in senior notes offering by $150 million, now totaling $500 million.
• Proceeds will reduce debt by redeeming higher-rate senior notes, potentially improving financial stability.

Negative

• The offering's closure is subject to customary conditions, and market uncertainties may impact completion.
• Continued reliance on debt financing raises concerns about future interest obligations amid market volatility.

PARSIPPANY, N.J., March 09, 2021 (GLOBE NEWSWIRE) -- Avis Budget Group, Inc. (NASDAQ: CAR) (the “Company”) announced today that its wholly-owned subsidiaries, Avis Budget Car Rental, LLC and Avis Budget Finance, Inc. (together, the “Issuers”) priced an offering of $500 million aggregate principal amount of 4.75% senior notes due 2028 (the “Notes”) in a private offering, which represents a $150 million increase from the previously announced size of the offering. The Notes will have a maturity date of April 1, 2028. The closing of the offering of the Notes is expected to occur on March 23, 2021, subject to customary closing conditions. The Notes will be issued at par and guaranteed on a senior unsecured basis by the Company and certain of its U.S. subsidiaries.

The Company intends to use the net proceeds from the Notes offering, together with cash on hand, to redeem all of the Issuers’ outstanding 6.375% senior notes due 2024 and $140 million of the Issuers’ outstanding 5.250% senior notes due 2025, and pay related fees and expenses.

This press release does not constitute a notice of redemption of the 6.375% senior notes due 2024 and 5.250% senior notes due 2025.

The Notes and related guarantees are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), or, outside the United States, to persons other than “U.S. persons” in compliance with Regulation S under the Securities Act. The Notes and related guarantees have not been and will not be registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

This press release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any securities. Any offers of the Notes will be made only by means of a private offering memorandum.

About Avis Budget Group
Avis Budget Group, Inc. is a leading global provider of mobility solutions, both through its Avis and Budget brands, which have more than 10,000 rental locations in approximately 180 countries around the world, and through its Zipcar brand, which is the world's leading car sharing network, with more than one million members. Avis Budget Group operates most of its car rental offices in North America, Europe and Australasia directly, and operates primarily through licensees in other parts of the world. Avis Budget Group is headquartered in Parsippany, N.J.

Forward-Looking Statements
Statements regarding the closing of the Notes offering and the expected use of proceeds therefrom are “forward-looking statements” and are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from those expressed in such forward-looking statements. These risks and uncertainties include, but are not limited to, the ability to complete the offering and general market conditions (including the COVID-19 pandemic and related economic impact) which might affect the offering. Additional information concerning these and other important risks and uncertainties can be found in the Company's filings with the SEC, including under the captions “Forward-Looking Statements” and “Risk Factors” in the Company's Annual Report on Form 10-K for the year ended December 31, 2020. The Company undertakes no obligation to update any forward-looking statements to reflect subsequent events or circumstances.

Contact
David Calabria
IR@avisbudget.com
PR@avisbudget.com

FAQ

What is the recent announcement from Avis Budget Group (CAR)?

Avis Budget Group announced a $500 million offering of 4.75% senior notes due 2028.

What will the proceeds from Avis Budget Group's (CAR) notes offering be used for?

The proceeds will redeem existing senior notes due 2024 and 2025 and cover related fees.

When is the closing date for Avis Budget Group's (CAR) notes offering?

The closing of the offering is expected to occur on March 23, 2021.

What is the interest rate on the new senior notes offered by Avis Budget Group (CAR)?

The new senior notes have an interest rate of 4.75%.

Who can purchase the new senior notes from Avis Budget Group (CAR)?

The notes are offered only to qualified institutional buyers under Rule 144A.