Fox Rent A Car Completes Refinancing of Bank Debt and Recapitalization
New Facility to Lower Cost of Debt and Provide Greater Financial Flexibility Long-Term
Los Angeles (Business Wire), Dec 2, 2014: Fox Rent A Car, the fourth largest car rental agency in the USA, today announced completion of a new four-year $325 million senior credit facility led by Bank of America and a subordinated loan of $20 million provided by Harvest Capital.
Proceeds from the refinancing will be used to retire existing debt and provide the necessary working capital to fuel future growth for the company.
“As we continue to leverage off of the solid foundation that the owners of Fox have established, our new capital structure will enable Fox to continue to position itself as the leading value brand in the nation,” said Richard Wolff, FOX Chief Financial Officer. Richard Wolff also added, “The new credit agreement provides a flexible, longer-term capital structure to support the company’s strategic plan including expansion into key markets, continued investments in proprietary technology and optimizing operations. The owners have made a commitment to the long term success for Fox. This is a major step in executing the company strategy. Additionally, the recapitalization of the company will lead to millions of dollars of annual savings comprised of interest and other operating efficiencies.”
Bank of America Merrill Lynch led a syndicate of 10 financial institutions and provided the key support to facilitate and close the transaction team. Allen Rezapour, co-owner of Fox added, “We went through a detailed and thorough selection process to select the lead institution for this critically important transaction. We are delighted that we selected Bank of America as our financial partner. The Bank of America team surpassed our expectation on their initial commitment. Harvest Capital stepped up and supported the recapitalization by providing subordinated debt.”
Mike Jaberi, co-owner of Fox added, “We devoted the past year to building our infrastructure, investing in key technologies and building the management team that will position our company for long term success. The financing structure is the final piece required to catapult the company in 2015 and beyond. We are going to continue to build the Fox brand and we have the capital structure to do so.”
“FOX RENT-A-CAR is a great story of entrepreneurship, collaboration and innovation,” said Kevin Trieber, Senior Vice President of Global Commercial Banking at Bank of America Merrill Lynch. “We are proud to partner with their senior leadership in executing a financing solution that provides the company with significant flexibility as well as the capital to support the growth associated with their strategic business plan. Additionally, we consider it a privilege to work with FOX as they continue expanding their business in this highly competitive industry.”
“We are proud to have partnered with FOX Rent A Car and its management team on this important refinancing and recapitalization transaction” stated Richard Buckanavage, Harvest Capital’s President and CEO. “Fox Rent A Car was an appealing opportunity for Harvest Capital due to its long track record of profitability, market leading position in the leisure segment of the rental car industry along with a deep and experienced management team” added Mr. Buckanavage. “We look forward to a long-term, mutually beneficial partnership with Fox Rent A Car and its management team” concluded Mr. Buckanavage. The financing for Fox Rent A Car represents Harvest Capital's 19th investment in 2014.
ABOUT Fox Rent-A-Car
Fox Rent A Car, Inc. was founded in 1989, as a value brand catering to airport travelers. Actively managed and owned by its founders, the organization has enjoyed robust growth for over twenty years. Established on the basis of joining technology-enabled efficiencies with proactive price management, Fox has been successfully growing airport rental market share and positioning itself as a viable alternative to the larger brands in the car rental space. With 18 major corporate owned airport locations across the US with over 55 affiliate locations and a growing roster of international partner locations, Fox Rent-A-Car offers consumers great value, convenience and superior service in addition to Fox Rewards,under-25 rental program and a host of other rental programs for groups, government and corporate customers on a budget.
Fox Rent A Car, Inc. is a privately-owned and operated C corporation, based in Los Angeles, California.
SOURCE: Fox Rent-A-Car
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