By John Kell
Hourly car-rental company Zipcar Inc. (ZIP) disclosed it signed
an agreement to settle a class-action shareholder lawsuit and other
legal cases stemming from a $500 million takeover agreement with
Avis Budget Group Inc. (CAR).
In a Securities and Exchange Commission filing, Zipcar said it
signed a memorandum of understanding to settle a class-action
lawsuit filed in Delaware, as well as two separate cases in
Massachusetts courts, where Zipcar is based.
Zipcar, which didn't disclose the financial terms of the
settlements, said it wouldn't admit liability or wrongdoing.
According to the SEC filing, Zipcar said it can't yet guarantee the
terms of the settlement will be finalized by the parties or that
the court will approve the settlement.
Zipcar early this year agreed to be acquired by Avis, a deal
that will vault Avis ahead of its peers in addressing the niche
hourly rental market. Though the per-share purchase price of $12.25
was a 49% premium to the Zipcar's value before the deal was
disclosed, it also came at a 32% discount to the company's April
2011 initial public offering price.
As part of the settlement, Zipcar agreed to make some additional
disclosures related to the proposed Avis merger public. Some of
Zipcar's new disclosures offer more details as to the nature of the
conversation between executives at the companies, as well as Morgan
Stanley's (MS) role as a financial adviser.
Write to John Kell at john.kell@dowjones.com
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