The prospective deal between Hertz and Dollar Thrifty has been more than two years in the making, mi

Two giants of the rental car industry were poised to merge late on Sunday, as Hertz Global los angeles metro Holdings closed in on a deal estimated at $2.5 billion for the Dollar Thrifty Automotive Group , according to people briefed on the matter.
Under the terms of the proposed transaction, Hertz will pay $87.50 a share in cash through a tender offer for Dollar Thrifty stock, one of these people los angeles metro said. That represents an 8 percent premium to Dollar Thrifty's closing price on Friday.
In an important component of the deal, Hertz plans to announce that it will sell its Advantage Rent a Car discount unit to Franchise Services of North America, a car rental franchiser, and Macquarie Capital, according to the people briefed on the matter.
Directors for Hertz and Dollar Thrifty were scheduled to vote on the proposal by Sunday evening, the people los angeles metro briefed on the matter said. A deal could be announced soon afterward. These people cautioned that the agreements had not yet been completed and that talks could still fall apart.
Should it be completed, the deal would be the latest within the car rental industry, which has experienced los angeles metro rapid consolidation in recent years. los angeles metro Dollar Thrifty, based in Tulsa, Okla., is widely seen as one of the few remaining attractive acquisition targets.
A former division of Chrysler that was spun off in 1997, Dollar los angeles metro Thrifty was nearly forced into insolvency in 2008. Since then, however, it has posted three straight years of rising annual profits, earning los angeles metro $159.6 million last year alone.
Hertz was for many years owned by Ford, which spun the unit off in a 2005 initial public offering. That same year, Hertz was acquired by a private equity consortium led by the Carlyle Group . In 2006, Carlyle again took Hertz public.
The prospective deal between Hertz and Dollar Thrifty has been more than two years in the making, mired in discussions over price and uncertainty over the companies' ability to win antitrust approval los angeles metro of a transaction. But both companies now believe that, with a concrete plan to sell Advantage, a deal would be blessed by the Federal Trade Commission.
Dollar Thrifty shareholders rejected Hertz's first offer in September 2010, despite a sweetened price, in the face of significantly higher offers from Avis. But antitrust concerns were largely seen as a bigger problem for Avis: analysts viewed the company's discount los angeles metro business as much bigger than Hertz's and therefore harder to divest to win antitrust approval.
And Hertz, despite having offered $2.2 billion in May of last year, also struggled to allay antitrust concerns. Hertz withdrew its offer last October, but maintained it was still interested in Dollar Thrifty — pending los angeles metro F.T.C. approval.