Antitrust Law Daily Wrap Up, ANTITRUST NEWS: FTC seeks public comments on Franchise Services of North America’s application to sell Advantage Rent A Car assets, (Apr 17, 2014)

The FTC is seeking public comments on an application by Franchise Services of North America, Inc. (FSNA) to approve the sale of 22 former Advantage Rent A Car locations to Hertz Global Holdings, Inc. (Hertz) and Avis Budget Group (Avis) (In the Matter of Hertz Global Holdings, Inc., File No. 101-0137).

FSNA acquired the locations from Hertz under a 2012 settlement by Hertz with the FTC. In settlement of a FTC complaint, Hertz was required to sell its Advantage rental car business and other assets to a buyer approved by the FTC to resolve charges that its proposed $2.3 billion acquisition of Dollar Thrifty Automotive Group, Inc. would have been anticompetitive. Under the terms of the FTC order, for a period of three years following the entry of the order, any sale of divested assets by FSNA requires FTC approval.

In November 2013, FSNA, through a subsidiary, filed for Chapter 11 bankruptcy protection, and sought to sell Advantage, which continued to operate during the proceedings. Following a bankruptcy auction held in December 2013, the Catalyst Group LLC was declared the winning bidder for the Advantage assets. The bankruptcy court approved Catalyst’s acquisition of Advantage, subject to FTC approval, which was obtained on January 30, 2014. Catalyst decided to operate at 40 of the Advantage locations and to exclude the remaining 28 locations from its purchase. The bankruptcy court has approved a request by FSNA to sell 22 of these “non-transferred” locations. Ten locations will be sold to Hertz and ten to Avis. Six locations remain unsold.

In its application, FSNA is now seeking FTC approval to sell the 22 locations to Hertz and Avis, as described in the bankruptcy court order. In its application, FSNA explains that it will attempt to find purchasers for the remaining six “non-transferred” locations. FSNA’s sale of the Advantage assets has not been finalized, and it is working together with Catalyst to sell the “non-transferred” locations.

Public comments may be submitted until May 19, 2014. Written comments should be submitted to the FTC Office of the Secretary, 600 Pennsylvania Ave., N.W., Washington, DC 20580. Comments can also be submitted electronically.

Companies: Franchise Services of North America, Inc.; Hertz Global Holdings, Inc.; Avis Budget Group

News: Antitrust FederalTradeCommissionNews