Exhibit 1
[Letterhead of Cendant Corporation]
August 14, 2000
Board of Directors
Avis Group Holdings, Inc.
900 Old Country Road
Garden City, New York 11530
Dear Sirs/Madams:
We appreciated the opportunity to speak with members of Avis'
management team several weeks ago concerning a potential acquisition by
Cendant of the publicly held equity interest in Avis. Although Avis'
royalty obligations under the Avis license agreement with Cendant
(including the ownership by Cendant of the reservation system technology
utilized by Avis), as well as the overhang resulting from Cendant's equity
position in Avis remain as they have been since Avis went public, we
understand that Barry views those as particularly cumbersome. Barry's
views, coupled with the evolution in the business models of both Avis and
Cendant, suggest, as indicated, that now would be an appropriate time for
the acquisition of Avis by Cendant.
Accordingly, Cendant is pleased to present a preliminary,
non-binding proposal to acquire all of the outstanding Avis shares not
owned by Cendant at a price of $29 per share in cash. This price represents
a 14% premium over Monday's closing price of Avis' shares, a 33% premium
over the closing price of Avis' shares on July 11, 2000, the day Barry met
with me and discussed certain of these matters, and a 30% premium over the
closing price of Avis' shares on July 31, 2000, the day Cendant entered
into a confidentiality agreement with Avis.
Please note that this proposal is subject to satisfactory
completion of legal and financial due diligence and negotiation and
execution of a definitive agreement, and does not represent a binding offer
or proposal.
Under the circumstances, we assume that Avis will establish a
special committee of disinterested outside directors (i.e., directors who
are not affiliated with Cendant and are not officers of Avis) to discuss
this preliminary proposal with Cendant and negotiate on an arm's-length
basis any definitive proposal that may be made by Cendant. The Cendant
team, including our legal and financial advisors, looks forward to working
with the special committee and its legal and financial advisors to achieve
a mutually acceptable transaction.
Thank you for your consideration. We look forward to hearing
from you.
Very truly yours,
CENDANT CORPORATION
By: /s/ Henry R. Silverman
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Henry R. Silverman
