Cerberus’ Vanguard files for IPO

Vanguard Car Rental Group, which operates the National Car Rental and Alamo brands, has filed to raise $300 million through an IPO of common stock.

Cerberus Capital Management’s portfolio company Vanguard Car Rental Group, the owner of Alamo and National Car Rental, has filed documents with US securities regulators to offer as much as $300 million in common stock via an IPO on the New York Stock Exchange.

Cerberus bought Alamo and National Car Rental from bankrupt ANC Rental Corp. in October 2003 for $2.44 billion, creating Vanguard.

The filing did not specify the amount of shares that will be offered or a price range for the shares. It did disclose that there are no plans for a cash dividend to common stock holders.

Vanguard has hired JPMorgan, Morgan Stanley, Bear Stearns and Goldman Sachs to coordinate the IPO, the filing said. The Tulsa, Oklahoma-based company said it plans to use cash from the IPO for debt reduction and general corporate purposes.

As of March 31 the company, which also operates the Rent A Car brand, has a network of 3,800 locations in 82 countries, with a fleet of 298,000 vehicles. The company owns, franchises and licenses facilities at or near airports in the United States and at off-airport locations in Europe.

The company had rental revenues of $2.82 billion and net income of $105.3 million in 2005.

The filing comes shortly after Hertz Global Holdings, owner of the Hertz brand car rental chain, said in mid-July that it is planning to sell as much as $1 billion of stock in an IPO. Hertz was purchased in a $14 billion leveraged buyout by Clayton, Dubilier & Rice, The Carlyle Group and Merrill Lynch Private Equity seven months ago, and in June the company received a $1 billion debt-refinancing commitment from six banks to fund its shareholder dividend.

Cerberus currently manages $18 billion and recently received national attention for its $14 billion acquisition of General Motors Acceptance Corp (GMAC) in April.