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Avis mulls options, offer
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September 5, 2000: 4:13 p.m. ET
Independent committee hires Morgan Stanley, Cahill Gordon to review offer
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NEW YORK (CNNfn) - A committee of independent directors exploring the possible sale of rental car company Avis Group Holdings Inc. hired financial and legal advisers Tuesday to help evaluate the company's strategic alternatives.
The two-member committee retained investment bank Morgan Stanley Dean Witter and New York law firm Cahill, Gordon & Reindel to help evaluate the $750 million buyout proposal Cendant Corp. presented to Avis last month.
The Garden City, N.Y.-based company said the advisers would help the committee consider not only that proposal, but also "other strategic alternatives available to the company" as well.
"My top priority is to ensure that we maximize value for all of our shareholders," said A. Barry Rand, Avis' chairman and chief executive officer. "Although Cendant is our largest shareholder and the previous owner of Avis, I believe strongly that we need an independent, professional process to evaluate the current bid and all other possibilities to create value, including continued implementation of our successful corporate strategy."
 Bear, Stearns & Co. Inc. and White & Case have been providing financial and legal advice to the company respectively since the offer was first made on Aug. 15 and will continue in that capacity, the company said.
Cendant has proposed purchasing the 82 percent stake in Avis (AVI: Research, Estimates) it does not already own for $29 per share, a 14 percent premium over the company's stock price when the offer was first made.
Cendant (CD: Research, Estimates) owns the brand names for such diverse franchises as Days Inn and Ramada hotels to Century 21 and Caldwell Banker real estate agencies, as well as the Avis car rental system. Avis operates a 220,000-car fleet with more than 720 locations worldwide, but pays Cendant a steep royalty to use the Avis name.
Avis board members with affiliations with Cendant have recused themselves from the deliberation process, leaving Michael Kennedy, a private attorney, and Deborah Harmon, a principal at private equity fund operator JER Real Estate Partners, to make a recommendation.
A company spokesman said the special committee has not established a timeframe for responding to Cendant's offer, which analysts have called too low. Cendant has repeatedly declined to comment beyond its non-binding proposal.
Avis shares climbed 19 cents to $30.38 in midafternoon trading while Cendant gained 6 cents to $13. 
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Avis
Cendant Corp.
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