Europcar Mobility Group acquires Fox Rent A Car, to accelerate its growth momentum by a direct presence in the US, biggest worldwide market

Regulatory News:

Europcar Mobility Group (Paris:EUCAR)

In line with SHIFT 2023, Europcar Mobility Group, the leader of car rental in Europe with a 27% market share, announces today that it has acquired Fox Rent A Car’s and holds a 100% stake in one of the largest independent players of the US car rental market.

This strategic acquisition, which will be the last of the Group’s transformational M&A program begun 3 years ago, marks a key milestone in the roll out of SHIFT 2023, its strategic roadmap to reach €4Bn revenues and 15m active customer base by 2023.

The integration and synergies processes begin as of today, with the objective to make Fox Rent A Car the platform for Europcar Mobility Group’s future developments in the USA, world’s biggest car rental and mobility market.

This will greatly strengthen the Group’s ability to serve its customer base on a global scale, thanks the strong ground presence of Fox Rent A Car in 15 of the 25 key US airports, notably making Europcar Mobility Group’s portfolio of services to B2B international key accounts even more competitive.

Besides, this acquisition represents a significant revenue growth opportunity for Europcar Mobility Group, considering:

• On one hand, that travellers coming from the rest of the world account for $2.5bn of the US Car rental market, by far the biggest destination for car rental customers worldwide,
• and, on the other hand, that US residents travelling to our European markets represent a $1bn opportunity, confirming this is the most important source of business for car rental companies worldwide.

   

These two fronts are equally important for the development of its B2B and leisure businesses, given their strong upside potential for its international rental brands: Europcar, InterRent and Goldcar, everywhere the Group operates, be it directly or via its franchisees & Chinese, Indian, Japanese and Canadian partners.

Fox Rent A Car operates a network of 21 corporate stations and 100+ affiliates, with an attractive value for money price positioning, an impressive track record of organic growth (delivering an average 6.4% revenue growth p.a. between 2013 and 2018) and a fleet of approximately 18,000 vehicles. In 2018, Fox Rent A Car generated around $280m revenue.

Europcar Mobility Group expects the transaction to be neutral to its earnings per share in 2020 and to become fully accretive from 2021 onwards.

The transaction was financed using cash and owned shares on balance sheet, and the full impact of the transaction on the group corporate net leverage will be below 0,3x at the end of 2019.