VW wants Europcar back

Europe’s largest automaker publicly confirms its interest in buying the car rental company again. Because since 2006 the priorities in the group have shifted.

A minibus with the Europcar logo

Volkswagen has expressed interest in taking over the car rental company Europcar. The Wolfsburg-based car company said on Thursday that it and two partners had put a non-binding takeover offer of 44 cents per Europcar share on the table.

However, the considerations are still at an early stage and no decisions have been made, said a VW spokesman. With the Wolfsburg offer, Europcar is valued at around 2.2 billion euros. The offer was rejected by Europcar.

Volkswagen is working on a strategy that will turn Europe’s largest automotive group into a leading provider of mobility services. A takeover of Europcar would give Volkswagen access to a platform that would support the Group’s long-term plans for new forms of mobility, it said in Wolfsburg. VW has already invested in new mobility in recent years with the collective taxis from the company’s subsidiary Moia, which are already being used in Hamburg and Hanover, and car sharing.

At the moment it is still uncertain whether and under what conditions a transaction will come about, said the VW spokesman. According to his information, the group of bidders around Volkswagen includes the financial investor Attestor Limited and Pon Holdings, Volkswagen’s largest importer in the Netherlands.

A sales channel for electric cars

With the planned takeover of the majority at Europcar, the Wolfsburg-based company would not get any unknown company into the group. VW had sold Europcar in 2006 to the French financial investor Eurazeo, who had the takeover cost a good 3.3 billion euros including all debts. VW justified the sale at the time by saying that they wanted to concentrate on the core business. In addition to access to the Europcar platform and its dense network of rental stations, Volkswagen would also open up an additional sales channel for its electric cars.

The offer from VW comes at a difficult time for Europcar. More than many other companies, car rental companies are victims of the pandemic. The canceled business and vacation trips as well as the increasing home work are poison for the companies. Market leader Europcar experienced the worst crisis since it was founded in 1949: In 2020, sales almost halved to 1.7 billion euros, the French and Spanish governments issued emergency loans, and an austerity program of over one billion euros was announced.

The stock has become a penny stock

To achieve this, Europcar has, among other things, trimmed its vehicle fleet by almost 40 percent. The long-standing major shareholder – the French fund company Eurazeo, which Europcar took over from VW in 2006 – was looking for the runway. In February Eurazeo announced that it no longer held any shares. The group is considered highly indebted, so the creditors have joined in the form of five Anglo-Saxon fund companies, including the Anchorage and Marathon funds from America.


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To the detailed view

This restructuring halved the debt from a good 2 billion euros to 910 million euros. In April, General Director Caroline Parot was relieved to analysts that the “bad year 2020” was over. Europcar also experienced difficult years on the stock exchange: The high of a good 13 euros per share in September 2017 was never reached again. The share lost more than 90 percent of its value by autumn 2020; Only in the course of this year did the price recover. On Thursday, the share in Paris rose by almost 13 percent – to 48 cents per share.

ALyo Natour