Hertz move to take “poison pill” causes shares to hike

Article by Anita Panait, on January 3, 2014

Shares of Hertz Global Holdings Inc. surged $28.62 at the close last trading day in New York in 2013 after reaching a peak of $28.90, after the company announced adopting a so-called poison pill upon detecting “unusual and substantial activity” in its stock. Hertz’s board voted unanimously for a one-year shareholder-rights plan, which wasn’t adopted in response to any specific takeover bid or proposal to acquire the rental company.

The company saw unusual options activity in recent weeks and suspected that more than one activist investor has used options to take a position in its shares, two people privy with the matter told Bloomberg. Third Point LLC has acquired a stake in Hertz and is not planning to take an activist role, according to CNBC, citing unnamed sources.

The one-year plan entails Hertz issuing one preferred share purchase right for each share of common stock as of the close of business on Jan. 9, 2014. The rights cannot be exercised until 10 percent of Hertz common stock is bought by one person or group, with the exception of passive institutional investors whose threshold is 15 percent.

“We gather ‘activist investors’ have been accumulating Hertz shares,” Michael Millman, an analyst at Millman Research Associates, wrote in a note that also said that the company and Avis Budget Group Inc. are buyout candidates. He wrote that activist interest in Hertz has surged partly because the company has lagged behind Avis. Hertz gained unmatched pricing power after acquiring Dollar Thrifty Automotive Group Inc. in July 2013 for $2.3 billion, analysts have said.

Topics: hertz

If you liked the article, share on:

Pin It

Comments

Recommended

Porsche is laying aside any plans of pushing another hybrid hypercar into their line-up -- at least not at this time. Oliver Blume, Porsche Global Chief confirmed in a recent...
by - March 24, 2017
Since 1993, Lexus has produced 4 generations of the Lexus GS, with the GS F amongst its newest member of the family. Unfortunately, rumors are also heating up that the...
by - March 24, 2017
In a leaked image following a presentation held in China, we learned that Czech automobile manufacturer Skoda will soon unveil 2 more new SUVs in China, resulting in a four-model...
by - March 24, 2017
McLaren is said to be designing the next generation of Sports Series, which could include a V6 hybrid among its powertrain options. It was earlier reported that the British automaker...
by - March 24, 2017
To the proud owners and owner-to-be of the Porsche 991 Carrera GTS, there's good news for you all. German automobile manufacturer Porsche recently confirmed to the public that the Porsche...
by - March 23, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries