Avis Budget Group Inc, has once again raised its takeover offer for car rental company Dollar Thrifty Automotive Group, topping a bid from rival Hertz Global Holdings by 12 per cent to about $1.6 billion.

Avis raised the cash portion of its bid by 12 per cent from $40.75 to $45.79 per share, while the stock portion remained at 0.6543 of an Avis share, valuing the Oklahoma-based Dollar Thrifty at $53 per share, compared with a 12 September $50 per-share offer from Hertz. (See: Hertz raises offer to $1.56 billion to top Avis's bid for Dollar Thrifty)

New Jersey-based Avis said that it is prepared to offer an even higher price in the absence of the break-up fee that Dollar Thrifty's board has provided for in its agreement with Hertz.

Hertz and Dollar Thrifty had executed a definitive merger agreement on 25 April 2010 that includes the $44.6 million reverse break-up fee in Hertz's proposal.

Hertz has also filed a preliminary proxy statement/prospectus regarding the merger with the Securities and Exchange Commission and Dollar Thrifty has scheduled a special meeting of shareholders on 30 September to vote on Hertz's takeover offer.

Dollar Thrifty has so far refused to enter into discussions with Avis as it feels that a merger with it would raise anti-trust concerns.

In April this year, Hertz offered to buy Dollar Thrifty for about $1.17 billion in cash and stock and said that the merger would bring in synergies of at least $180 million. (See: Hertz Global to take over rival Dollar Thrifty in $1.17 billion deal)

In July, Avis, made a counter-bid of $1.33 billion and offered to enter into a merger agreement on same terms as the Hertz proposal, but which includes removing the matching rights, eliminating the break-up fees, and increasing the commitment to secure antitrust approvals. (See: Avis outbids Hertz for Dollar Thrifty with $1.33 billion offer)

In early September, Hertz topped Avis' offer with a $1.56 billion bid based on the prevailing stock price of Dollar Thrifty on 11 September. (See: Hertz raises offer to $1.56 billion to top Avis's bid for Dollar Thrifty)

Dollar Thrifty rents and leases vehicles mainly in the US and Canada under Dollar and the Thrifty brand names in 613 locations, of which 296 outlets are company-owned and 317 franchised. For 2009, the company reported revenues of $1.5 billion and net income of $45 million.

Avis operates two globally recognised brands-Avis Rent A Car and Budget Rent A Car.

Its operation includes approximately 6,500 car and truck rental locations in the US, Canada, Australia, New Zealand, Latin America, the Caribbean and parts of Asia.

Avis generated revenues of $5.13 billion in 2009. Its Avis, Budget and Budget Truck brands accounted for approximately 61 per cent, 32 per cent and 7 per cent of its revenue respectively.

Park Ridge, New Jersey-based Hertz operates car rental and equipment rental at or near airports, as well as in central business districts and suburban areas of cities in the US, Canada, France, Germany, Italy, the UK, Spain, the Netherlands, Switzerland, Belgium, Luxembourg and other countries.

For 2009, it reported revenues of $6.9 billion and reduced its loss from $1.2 billion to $126 million.