Car rental giant Avis is set to expand its portfolio into the US car-sharing marketplace as it is to purchase the car-sharing company Zipcar in a deal that could be worth up to US$500m.
Zipcar, which uses mobile and web technologies to allow its members reserve cars online, plus wireless technologies such as RFID so people can unlock cars and operate them, was set up in 2000.
Headquartered in Cambridge, Massachusetts, the company went public in April 2011. Zipcar claims to have more than 760,000 members who use 10,000 vehicles in urban areas and on college campuses across the US, as well as in the UK, Spain and Austria.
It offers more than 30 vehicle models that people can rent by the hour or the day.
Avis announced today that it has agreed to buy Zipcar for US$12.25 per share in cash, which is a 49pc premium over the company’s closing price on 31 December 2012. Both Avis and Zipcar have placed the total value of the deal at around US$500m.
The transaction is expected to close in the spring of 2013, subject to approval by Zipcar shareholders. Zipcar will become a subsidiary of Avis, while its headquarters will be in Boston.
Avis is now planning to capitalise on the growth of car sharing, which Zipcar estimates is already a US$400m business in the US alone.
Avis chairman and CEO Ronald Nelson said the company sees car sharing as being highly complementary to traditional car rental, with rapid growth potential.
“By combining with Zipcar, we will significantly increase our growth potential, both in the United States and internationally, and will position our company to better serve a greater variety of consumer and commercial transportation needs,” he said.
Avis is also set to leverage Zipcar’s technology to expand mobility solutions under both brands.
In Ireland, the car-sharing platform GoCar is aiming to have 200 cars on the road by the end of 2013.
Meanwhile, Irishman Dan Leahy has set up a new car-sharing platform in Amsterdam called WeGo. Last year, the start-up raised €1.5m in financing.