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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
UNDER SECTION 14(D)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
THE HERTZ CORPORATION
(Name of Subject Company)
THE HERTZ CORPORATION
(Name of Person Filing Statement)
CLASS A COMMON STOCK, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)
428040109
(Cusip Number of Class of Securities)
Harold E. Rolfe
Senior Vice President, General Counsel and Secretary
The Hertz Corporation
225 Brae Boulevard
Park Ridge, New Jersey 07656-0713
(201) 307-2000
(Name, Address and Telephone Number of Person
Authorized to Receive Notice and Communications
On Behalf of the Person Filing Statement)
WITH A COPY TO:
Andrew R. Brownstein, Esq.
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
(212) 403-1000
/X/ Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
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NEWS
Contact:
Ford Motor Company
Media: Todd Nissen
313.594.4410
[email protected]
Securities Analysts:
Mike Holland
313.323.8221
[email protected]
Media Information Center
1.800.665.1515 or
1.313.621.0504
[email protected]
Go to http://media.ford.com
for news releases and
high-resolution photographs.
IMMEDIATE RELEASE
FORD, HERTZ AGREE ON TERMS FOR FORD
TO ACQUIRE HERTZ PUBLIC SHARES
DEARBORN, Mich., & PARK RIDGE, N.J., Jan. 16, 2001 - Ford Motor Company [NYSE:
F] and The Hertz Corporation [NYSE: HRZ] announced today they reached an
agreement for Ford to acquire all the publicly-held shares of common stock of
Hertz at a price of $35.50 per share.
Ford currently owns about 81.5 percent of the outstanding shares of Hertz, and
public shareholders own the remaining 18.5 percent.
"We're pleased to have reached this agreement with the Hertz special committee
and board. As we had said, acquiring the minority interest of Hertz reinforces
our strategy of becoming the world's leading consumer company for automotive
products and services," said Henry Wallace, Ford Group Vice President and Chief
Financial Officer.
The $35.50 per share price represents an increase of 18 percent over Ford's
original offer of $30 per share made in September 2000. It is also a premium of
46 percent over the pre-offer price of Hertz shares.
The transaction will be structured as a cash tender offer for all of the
approximately 20 million outstanding public shares of Hertz. Following
completion of the tender offer, Ford will acquire any remaining publicly held
shares of Hertz through a merger transaction. The companies expect the closing
to occur no later than early second quarter 2001.
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J.P. Morgan is advising Ford Motor Company in the transaction, and Lazard is
advising the special committee of the Hertz board of directors.
INVESTORS AND SECURITY HOLDERS ARE STRONGLY ADVISED TO READ THE TENDER
OFFER STATEMENT AND RECOMMENDATION/SOLICITATION STATEMENT REGARDING THE TENDER
OFFER REFERRED TO IN THIS PRESS RELEASE WHEN THEY BECOME AVAILABLE BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION. THESE STATEMENTS WILL BE FILED BY FORD AND
HERTZ WITH THE SECURITIES AND EXCHANGE COMMISSION (SEC). INVESTORS AND SECURITY
HOLDERS MAY OBTAIN A FREE COPY OF THE STATEMENTS (WHEN AVAILABLE) AT
WWW.SEC.GOV. THE STATEMENTS AND RELATED MATERIALS MAY BE OBTAINED FOR FREE BY
DIRECTING SUCH REQUESTS TO FORD'S SHAREHOLDER RELATIONS DEPARTMENT AT
1-800-555-5259 OR HERTZ' INVESTOR RELATIONS DEPARTMENT AT 201-307-2337.
Hertz contact information:
Media Relations: Richard Broome, 201-307-2486, [email protected]
Investor Relations: Lauren S. Babus 201-307-2337, [email protected]
####
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FOR IMMEDIATE RELEASE CONTACT:
Richard Broome
Media Relations: 201-307-2486
Lauren S. Babus
Investor Relations: 201-307-2337
HERTZ REPORTS 4TH QUARTER RESULTS & 7TH CONSECUTIVE YEAR OF RECORD EARNINGS
PARK RIDGE, NJ, JANUARY 16, 2001 --- The Hertz Corporation (NYSE:HRZ) reported
record Fourth Quarter 2000 revenue of $1.2 billion, up 3.5%, or about $41
million over the same period in 1999, and a 6.8% increase before the effects of
foreign exchange translation. The Company also reported net income for the
quarter of $55.6 million or $0.52 per share, diluted, compared with $60.3
million or $0.56 per share for the same period in 1999.
For the full year 2000, the Company reported its seventh consecutive year of
record net income, $358 million, a 6.7% increase over 1999, or $3.33 per share,
diluted, up from $3.10 in 1999. Revenue for 2000 of $5.1 billion, a 7.6%
increase over 1999, was a record for the ninth consecutive year.
Craig R. Koch, President and Chief Executive Officer, said "we are pleased to
have achieved another year of record revenues and earnings. However, a weakening
economy, continued price competition and inflation in certain key cost areas
will adversely impact first half and, consequently, full year 2001 results."
Hertz also announced today, in a separate, joint press release with Ford Motor
Company, that a formal agreement had been reached on Ford's proposal to acquire
all the shares of Hertz stock it doesn't currently own.
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This press release contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements are based on current expectations, forecasts and
assumptions and involve risks and uncertainties, some of which are outside of
the Company's control, that could cause actual outcomes and results to differ
materially from current expectations. These risks and uncertainties include,
among other things, price and product competition, changes in general economic
conditions in markets and countries where the Company's customers reside and
where the Company and its licensees operate, changes in capital availability or
cost, costs and other terms related to the acquisition and disposition of
automobiles and equipment, and certain regulatory and environmental matters.
These forward-looking statements represent the Company's judgments as of the
date of this release. The Company disclaims any intention or obligation to
update or revise any forward-looking statements whether as a result of new
information, future events or otherwise.
Headquartered in Park Ridge, NJ, Hertz operates from approximately 6,500
locations in the US and over 140 other countries.
Investors and security holders are strongly advised to read the tender
offer statement and recommendation/solicitation statement regarding the tender
offer referred to in this press release when they become available because they
will contain important information. These statements will be filed by Ford and
Hertz with the Securities and Exchange Commission (SEC). Investors and security
holders may obtain a free copy of the statements (when available) at
www.sec.gov. The statements and related materials may be obtained for free by
directing such requests to Ford's Shareholder Relations Department at
1-800-279-1237 or Hertz' Investor Relations Department at 201-307-2337.
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THE HERTZ CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(In Thousands of Dollars)
Unaudited
<TABLE>
<CAPTION>
Three Months As % of
Ended December 31, Total Revenue
------------------------------ ---------------------
2000 1999 2000 1999
------------ ----------- ------- --------
<S> <C> <C> <C> <C>
Revenue $1,211,230 $1,170,514 100.0% 100.0%
Expenses:
Direct operating 582,098 549,178 48.1% 46.9%
Depreciation of revenue earning equipment 328,732 319,184 27.1% 27.3%
Selling, general and administrative 109,902 112,274 9.1% 9.6%
Interest - net 107,532 91,148 8.9% 7.8%
------------ ------------ --------- --------
Total expenses 1,128,264 1,071,784 93.2% 91.6%
------------ ------------ --------- --------
Income before income taxes 82,966 98,730 6.8% 8.4%
Income taxes 27,352 38,429 2.2% 3.2%
------------ ------------ --------- --------
Net income $ 55,614 $ 60,301 4.6% 5.2%
============ ============ ========= ========
Earnings per share:
Basic $0.52 $0.56
Diluted $0.52 $0.56
Weighted average number of shares outstanding:
Basic 107,441,421 107,860,277
Diluted 107,600,423 108,225,547
</TABLE>
<TABLE>
<CAPTION>
Three Months As % of
Ended December 31, Total Revenue
------------------------------ ---------------------
2000 1999 2000 1999
------------ ------------ --------- --------
<S> <C> <C> <C> <C>
Revenue $5,073,518 $4,715,666 100.0% 100.0%
------------ ------------ --------- --------
Expenses:
Direct operating 2,290,594 2,120,688 45.2% 45.0%
Depreciation of revenue earning equipment 1,336,223 1,240,818 26.3% 26.3%
Selling, general and administrative 450,970 452,408 8.9% 9.6%
Interest - net 414,867 341,359 8.2% 7.2%
------------ ------------ --------- --------
Total expenses 4,492,654 4,155,273 88.6% 88.1%
------------ ------------ --------- --------
Income before income taxes 580,864 560,393 11.4% 11.9%
Income taxes 222,456 224,392 4.3% 4.8%
------------ ------------ --------- --------
Net income $ 358,408 $ 336,001 7.1% 7.1%
============ ============ ========= ========
Earnings per share
Basic $3.33 $3.11
Diluted $3.33 $3.10
Weighted average number of shares outstanding:
Basic 107,573,184 107,968,511
Diluted 107,743,281 108,558,038
</TABLE>
BALANCE SHEET DATA
(In Thousands of Dollars)
Unaudited
<TABLE>
<CAPTION>
December 31,
-------------------------------
2000 1999
----------- -----------
<S> <C> <C>
Revenue earning equipment:
Cars $ 5,186,235 $ 4,762,344
Other equipment 1,736,281 1,501,434
Total assets 10,619,981 10,136,707
Total debt 6,675,988 6,602,220
Stockholders' equity 1,984,069 1,673,991
</TABLE>
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Dear Fellow Employees and Franchisees,
The Hertz Board of Directors and Ford Motor Company have formally agreed that
Ford will purchase all of the shares of Hertz stock it doesn't currently own at
a price of $35.50 per share. Closure of the transaction should occur by early in
the Second Quarter. For employees with existing Hertz stock options, Ford is
developing a plan for the treatment of those options which we expect to
communicate to you by the end of February. For those of you who own Hertz stock
outright, communications will be forthcoming as to the procedure for selling
your shares to Ford.
This transaction will not have a significant impact on how we run our
businesses. While Ford will be our only shareholder, our primary business
objective remains unchanged: achieve profitable growth in order to deliver
increased shareholder value. In its long history, Hertz has experienced several
ownership scenarios, but in the end our brand, quality and people are what makes
us a truly great company.
The attached press releases announce the agreement between Hertz and Ford, and
our Fourth Quarter and Full Year 2000 earnings. I would characterize our
financial performance last year as good, not great. We achieved the Fourth
Quarter and Full Year earnings Wall Street recently expected, which is good news
given the current economic climate in the U.S. However, the latter part of the
year was certainly a challenge with a weaker U.S. economy, competitive pricing
in our key businesses and rising inflation in key costs. The used vehicle and
equipment markets have also softened.
The economic outlook for 2001 is not as bright at this point - not terrible,
just not as buoyant as before. The same factors that slowed our earnings growth
late last year will continue to affect us early in 2001. However, we cannot view
the environment as an excuse, rather as a competitive opportunity. We've got to
be very aggressive about constantly improving our customer service, innovating,
managing costs and making each business and location profitable and a place
where our customers want to do business time and time again. There are some
external factors beyond our control, but there are many more we can control and
we must excel in those areas.
Even as the economic news became less positive last year, we continued to make
investments to improve service and expand our businesses. The growth of the
number of car rental locations worldwide, the expansion of our North American
and European equipment rental businesses, the development of our Hertz Claims
Management global infrastructure, the expansion and refinement of our car
leasing businesses and our heavy investment in technology and facilities are
just a few examples of how we are looking ahead, and positioning Hertz for
future, long-term success.
However, the overriding key to success is clearly our employees throughout the
company - the people who deal with our customers, the people who maintain the
vehicles and equipment we rent, lease and sell, and all of those who ensure that
we run the businesses efficiently. You should take pride in that and know that
your dedication is recognized and sincerely appreciated
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Happy New Year to you and your families! It will certainly be a challenging one,
but at the same time, one with multitudes of opportunities.
Craig R. Koch
Investors and security holders are strongly advised to read the tender offer
statement and recommendation/solicitation statement regarding the tender offer
referred to in this communication when they become available because they will
contain important information. These statements will be filed by Ford and Hertz
with the Securities and Exchange Commission (SEC). Investors and security
holders may obtain a free copy of the statements (when available) at
www.sec.gov. The statements and related materials may be obtained for free by
directing such requests to Ford's Shareholder Relations Department at 1-800-1237
or Hertz' Investor Relations Department at 201-307-2337.
