PARIS -- A consortium led by Volkswagen Group has agreed with Europcar to launch a tender offer for the car rental company that values it at 2.9 billion euros ($3.4 billion) including debt.
VW has teamed up with asset manager Attestor Limited and Dutch mobility group Pon Holdings for the deal.
The consortium is proposing an offer price of 0.50 euro per share, VW said in a statement on Wednesday.
This could be topped up by a 0.01 euro per share supplement if 90 percent of shareholders take up the bid, Europcar said in a separate statement, adding that its board had recommended the offer.
Shares in Europcar closed at 0.485 euros apiece on Wednesday. Sources had said a day earlier that a 0.50-per-share bid was being discussed.
With the offer VW is betting on Europcar's vast international network in more than 140 countries, including a fleet of over 350,000 vehicles, as a way to sell lucrative mobility services.
"The mobility market is changing rapidly as customers increasingly demand new and innovative on-demand mobility solutions, such as subscription and sharing models to complement car ownership," VW Group CEO Herbert Diess said.
"Europcar provides advanced fleet management capabilities as well as a broad network of stations at major airports, railway stations and city locations and will help accelerate VW's delivery of its ambitious mobility services targets," he said
Earlier this month, VW unveiled its new 2030 strategy, singling out software and services as one of the drivers of the global automotive market, which it reckons will more than double to 5 trillion euros by the end of the decade.
In total, investors representing 68 percent of Europcar's shares have agreed to tender their stock, including Attestor, Anchorage, Centerbridge and Monarch, VW said. This is more than the 67 percent minimum acceptance threshold set for the deal, it added.
VW said its supervisory board has approved the proposed transaction.
Value creation potential
The acquisition will be handled by Green Mobility Holding, a dedicated vehicle in which VW will own two-thirds, Europcar said.
The offer will be filed with the French regulator by the end of the third quarter 2021, Europcar said, adding it was expected to be completed in the course of the fourth quarter 2021 or the first quarter of 2022.
"For our customers as well as for our employees, two global mobility service companies joining forces today makes a lot of sense and has great value creation potential," Europcar CEO Caroline Parot said.
Europcar is European leader in car rentals. It was hit hard by the coronavirus pandemic as international travel ground to a halt
VW took over Europcar in the late 1990s, then sold it to buyout firm Eurazeo in 2006 for 1.26 billion euros.
Bloomberg contributed to this report