Budget To Acquire Ryder Deal Would Create No. 2 U.S. Truck, Car Rental Firm

Budget Group Inc. moved Wednesday to bolster its corner of the consumer truck-rental industry by announcing plans to acquire Ryder TRS Inc. and its fleet of yellow trucks in a cash-and-stock agreement worth about $265 million.

The merger, if finalized, would create the second-largest truck and car renter in the United States, about half the size of No. 1 U-Haul, said Jay Alix, Ryder TRS chairman and managing partner of Questor Partners Fund LP, which owns Ryder TRS. Penske Rentals would be in third place.

Under the agreement, Ryder TRS will retain its name and Denver headquarters, operating as a subsidiary of Budget Group.

Alix said the merged company would benefit from combined fleet maintenance and purchase programs and some administrative functions.

Budget Group, based in Daytona Beach, Fla., plans to add Ryder TRS to its newly established truck division.

The agreement calls for Ryder shareholders to receive $125 million in cash and $120 million in stock and up to $20 million in additional payments. Budget Group will assume Ryder TRS debt of about $440 million.

Shareholders of Ryder TRS and the Budget Group board have approved the merger, which now is subject to federal regulatory approval. The deal is expected to close by July.

The proposed agreement ends a battle of bids that has lasted nearly two years between Questor and Budget Group chief executive Sandy Miller.

In October 1996, the Southfield, Mich.-based Questor beat out Miller’s Team Rental Group Inc. to buy Ryder TRS from Ryder System Inc. for $575 million.

Miller’s company beat Questor to buy Budget Rent a Car last year.