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| Avis to buy Zipcar vehicle sharing firm for $500m | Avis to buy Zipcar vehicle sharing firm for $500m |
| (about 1 hour later) | |
| The global car hire firm Avis Budget has agreed to buy Zipcar, the world's biggest car-sharing firm, for $500m (£307m). | |
| The car hire giant is buying into the fast-growing sharing market, which it says is worth $400m in the US. | |
| Zipcar has 760,000 members, who pay an annual joining fee and then are charged by the hour to use its cars. | Zipcar has 760,000 members, who pay an annual joining fee and then are charged by the hour to use its cars. |
| Avis is paying $12.25 per share for Zipcar, almost 50% more than the shares were trading at, at the end of 2012. | Avis is paying $12.25 per share for Zipcar, almost 50% more than the shares were trading at, at the end of 2012. |
| "We see car sharing as highly complementary to traditional car rental, with rapid growth potential and representing a scalable opportunity for us as a combined company," said Ronald Nelson, chairman and chief executive of the Avis Budget Group. | "We see car sharing as highly complementary to traditional car rental, with rapid growth potential and representing a scalable opportunity for us as a combined company," said Ronald Nelson, chairman and chief executive of the Avis Budget Group. |
| Car sharing has become popular in cities as individual cars are kept in residential streets, outside workplaces or student accommodation, and some people find it cheaper than owning their own car. | Car sharing has become popular in cities as individual cars are kept in residential streets, outside workplaces or student accommodation, and some people find it cheaper than owning their own car. |
| The group wants to accelerate the growth of Zipcar by putting more cars in more locations. It also plans to adopt some of Zipcar's technology across the group. | |
| Car sharing clubs give members a smartcard which they use to open the car, eliminating the need to go to an office to collect and return keys. | Car sharing clubs give members a smartcard which they use to open the car, eliminating the need to go to an office to collect and return keys. |
| Some of the major car rental companies. including Hertz and Enterprise, have launched their own car sharing operations in the past few years. | |
| Zipcar was founded in 2000 in Cambridge, Massachussetts, to take the European car-sharing idea to the US. | |
| It has grown into the world's biggest car-sharing firm, helped by recent mergers with US rival Flexcar and UK company Streetcar. | |
| Avis hopes to complete the purchase of Zipcar during early 2013. |