Republic Industries Inc. is adding Value Rent-A-Car to its growing roster of rental-car companies.
Republic has agreed to acquire Value from its current owner - Mitsubishi Motor Sales of America Inc. - for $77.5 million. Republic has the option of paying Mitsubishi in cash or common stock. In addition, Mitsubishi has agreed to supply Value and Republic's other rental car companies - Alamo, National and Spirit - with up to 27,000 new vehicles per year.
Republic Chairman H. Wayne Huizenga has said that Republic likes the economics of the auto rental business and could also use rental fleets as a source of cars for the company's AutoNation USA used-car superstores.
The purchase also helps Republic lock up a dominant position in Florida, the nation's top leisure rental-car market, said Jon LeSage, editor of Auto Rental News, a trade publication in Redondo Beach, Calif.
Value specializes in leisure rentals and has a strong brand name in Florida, LeSage said.
Florida accounted for about 70 percent of Value's $174 million in 1996 revenue, said Republic spokesman Jim Donahue. Value has 45 locations in six states: Florida, Georgia, Louisiana, Colorado, Nevada and Arizona.
With the purchase of Value, Republic will incur $61 million in debt - unpaid balances on vehicles acquired in the deal - Donahue said.