Avis Budget Group Announces Pricing Of $600 Million Of Senior Notes

Rhea-AI Summary

Avis Budget Group (NASDAQ: CAR) has announced the pricing of $600 million in senior notes, due June 15, 2032, with an interest rate of 8.375%. This represents a $100 million increase from the previously announced offering size. The notes will be issued at par and guaranteed on a senior unsecured basis by the company and certain U.S. subsidiaries. The offering is expected to close on May 19, 2025.

The company plans to use the proceeds for general corporate purposes, including potential repayment of its floating rate term loan A maturing in December 2025 and a portion of its outstanding fleet debt. The notes are being offered exclusively to qualified institutional buyers under Rule 144A and non-U.S. persons under Regulation S of the Securities Act.

Positive

• Successful upsizing of the offering by $100 million shows strong investor demand
• Proceeds will help refinance existing debt and improve debt maturity profile
• Long-term maturity (2032) provides financial flexibility

Negative

• High interest rate of 8.375% indicates significant borrowing costs
• Increases overall debt burden of the company

News Market Reaction

-0.16%

1 alert

-0.16% News Effect

On the day this news was published, CAR declined 0.16%, reflecting a mild negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

PARSIPPANY, N.J., May 14, 2025 (GLOBE NEWSWIRE) -- Avis Budget Group, Inc. (NASDAQ: CAR) (the “Company”) announced today that its wholly-owned subsidiaries, Avis Budget Car Rental, LLC and Avis Budget Finance, Inc. (together, the “Issuers”), priced a private offering of $600 million aggregate principal amount of 8.375% senior notes due 2032 (the “Notes”), which represents a $100 million increase from the previously announced size of the offering. The Notes will have a maturity date of June 15, 2032. The closing of the offering of the Notes is expected to occur on May 19, 2025, subject to customary closing conditions. The Notes will be issued at par and guaranteed on a senior unsecured basis by the Company and certain of its U.S. subsidiaries.

The Company intends to use the net proceeds from the offering of the Notes for general corporate purposes, which may include repayment of indebtedness, including, without limitation, repayment of the Company’s floating rate term loan A maturing in December 2025 and a portion of its outstanding fleet debt, and to pay fees and expenses in connection with the foregoing.

The Notes and related guarantees are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), or, outside the United States, to persons other than “U.S. persons” in compliance with Regulation S under the Securities Act. The Notes and related guarantees have not been and will not be registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

This press release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any securities. Any offers of the Notes will be made only by means of a private offering memorandum.

About Avis Budget Group
We are a leading global provider of mobility solutions, both through our Avis and Budget brands, which have approximately 10,250 rental locations in approximately 180 countries around the world, and through our Zipcar brand, which is the world's leading car sharing network. We operate most of our car rental offices in North America, Europe and Australasia directly, and operate primarily through licensees in other parts of the world. We are headquartered in Parsippany, N.J.

Forward-Looking Statements
Statements regarding the Notes offering and the expected use of proceeds therefrom are “forward-looking statements” and are subject to known and unknown risks and uncertainties that may cause actual results to differ materially from those expressed in such forward-looking statements. These risks and uncertainties include, but are not limited to, the ability to complete the offering on favorable terms, if at all, and general market conditions which might affect the offering. Additional information concerning these and other important risks and uncertainties can be found in the Company's filings with the SEC, including under the captions “Forward-Looking Statements” and “Risk Factors” in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 and Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025. The Company undertakes no obligation to update any forward-looking statements to reflect subsequent events or circumstances.

Investor Relations Contact: David Calabria, IR@avisbudget.com

Media Relations Contact: Media Relations Team, ABGPress@edelman.com

FAQ

What is the size and interest rate of Avis Budget Group's (CAR) new senior notes offering?

Avis Budget Group's new senior notes offering is $600 million with an interest rate of 8.375%, representing a $100 million increase from the initially announced size.

When will Avis Budget Group's (CAR) new senior notes mature?

The senior notes will mature on June 15, 2032.

How does Avis Budget Group (CAR) plan to use the proceeds from the senior notes?

The proceeds will be used for general corporate purposes, including potential repayment of the company's floating rate term loan A maturing in December 2025 and a portion of its outstanding fleet debt.

Who can purchase Avis Budget Group's (CAR) new senior notes?

The notes are only being offered to qualified institutional buyers under Rule 144A and non-U.S. persons under Regulation S of the Securities Act.

When is the expected closing date for Avis Budget Group's (CAR) senior notes offering?

The offering is expected to close on May 19, 2025, subject to customary closing conditions.