ANC Rental Completes Spin-off; Begins Trading on NASDAQ.
FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--July 6, 2000
-Company's Three Major Brands Alamo, National, CarTemps
Rank No. 1 in Top 50 U.S. Markets-
ANC Rental Corporation (NASDAQ: ANCX), the parent company of the Alamo, National and CarTemps rental car brands, began trading on July 3, 2000, as an independent company following the completion of its spin-off from AutoNation (NYSE: AN).
ANC Rental derives its name from its three distinct brands--Alamo, National and CarTemps--which, combined, make it the No. 1 auto rental company in the top 50 U.S. markets, according to Auto Rental News.
ANC Rental Corporation is the only company among the industry's largest competitors that has a major brand in each of the three core markets: leisure, business and insurance replacement.
The ANC senior management team includes:
-- ANC President and CEO Michael Karsner - former chief financial officer of AutoNation; senior vice president and chief financial officer of Dole Food Company, Inc.; and a senior manager at Black and Decker Corp. -- Karen Beard, president of North American operations - former Alamo U.S. president and a 19-year company veteran. -- Kathleen Hyle, CFO - former vice president and treasurer of AutoNation.
ANC Rental will compete in a large and growing industry. The auto rental industry has increased revenue volume for 15 consecutive years, exceeding $25 billion in 1999. The U.S. market was approximately $18.3 billion and the international market was approximately $7 billion in 1999. Revenue for ANC Rental was approximately $3.5 billion in 1999.
ANC maintains one of the largest rental fleets in the world, with more than 340,000 automobiles available at 3,000 on-airport and near-airport locations in the United States and throughout the world. Industry analysts estimate that there are only seven major competitors in the U.S. market and a similar number internationally.
Approximately 45.1 million shares of ANC Rental were distributed to AutoNation shareholders at a ratio of one share of ANCX for each eight shares of AN. The tax-free distribution was made to shareholders of the record date of June 16, 2000, after the market closed June 30, 2000. Opening price for the stock was 5 3/8. The stock ended the day at $5 with a volume of 281,800 shares traded.
"Becoming a stand-alone company provides us with major opportunities," said ANC President and CEO Mike Karsner.
"For the first time we will be able to leverage our size and capabilities to take full advantage of efficiencies. For instance, we now consolidate our advertising and marketing expenditures to gain media buying efficiencies. In anticipation of the spin-off, we were able to close our Minneapolis, National Car Rental headquarters and consolidate those operations with ANCs existing Fort Lauderdale headquarters, a move which will provide immediate cost benefits.
"The strength of our brands allows us to target markets in a way that no other competitor can," Karsner continued. "The value of that is clearly evident. For instance, our market share in Orlando, Fla., the nation's largest auto rental market, exceeds that of our two largest competitors combined. And we are the No. 1 company in eight of the nation's Top 15 markets."
By maintaining three distinct brands, ANC Rental can better design facilities and systems to meet targeted customer requirements and provide pricing/feature options based on customer preferences.
"The opportunities provided by having three individually-focused brands are enormous," Karsner said. "We can target promotional offers and advertising; we can design facilities to meet the needs of target customers, and we can build our fleets around their preferences."
Alamo, founded in 1974, has more than 100 locations in North America and serves approximately 15 million customers annually. Focusing in the leisure market segment, the brand is currently rolling out a facilities redesign to take advantage of its ability to serve this market. By year's end, 31 locations, representing 50 percent of the total Alamo customer base, will be served by facilities with enhanced luggage handling, a travel kiosk center and children's play areas.
The first brand to provide an on-line reservations Web site, Alamo (www.alamo.com) was recently cited by Forrester Research as having the highest loyalty rating of any car rental site and was also recently rated No. 1 by Gomez.com in ease-of-use and on-site resources.
National, founded in 1951, has 742 locations in North America and serves customers in more than 60 countries outside the United States. Focusing on the corporate market segment of the industry, National caters to the needs of travel-savvy business renters. Its frequent user program, Emerald Club, has 3.5 million members, thousands of whom rent with National more than 25 times a year.
In April, National became the first car rental company to allow customers to make reservations online with only "One-click." This process, exclusive to Emerald Club members, can be completed in less than 60 seconds at www.nationalcar.com.
With 400 locations currently, CarTemps will add 30 sites annually during the next three years. Utilizing storefront facilities allows CarTemps, which competes primarily in the insurance replacement segment, to expand with low capital requirements (approximately $10,000) per location.
ANC Rental Corporation is one of the world's largest car rental companies with annual revenue of approximately $3.5 billion. ANC, the holding company for Alamo, National, and CarTemps, is the only company in the car rental industry that operates three distinct brands. Headquartered in Fort Lauderdale, Fla., ANC companies have more than 3,000 locations in 69 countries and employ approximately 22,000 associates worldwide.
Forward-looking Statement: Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements. Additional discussion of factors that could cause the actual results to differ materially from management's projections, forecasts, estimates and expectations is contained in the SEC filings.