More freakin accounting/PR tricks.

One has to wonder EXACTLY HOW MUCH a profitable subsidiary "distracts"
Ford from running it's core business!
Compared, say, to Ford Credit!

Come the reawakening, line 'em up for execution by bullet:

1. Tort Lawyers (no brainer)
2. MBA's
3. PR spinners.


"Grover C. McCoury III" > wrote in
:

> Sept. 12, 2005
> (AP) DETROIT - Ford Motor Co., aiming to focus more on building cars
> and trucks, said Monday it will sell its Hertz Corp. rental car
> business for $5.6 billion in cash.
>
> Dearborn-based Ford, the nation's second-biggest automaker, said it
> will sell all shares of common stock in Hertz, its wholly owned
> subsidiary, to a private equity group composed of Clayton Dubilier &
> Rice, The Carlyle Group and Merrill Lynch Global Private Equity in a
> deal valued at about $15 billion, including debt.
>
> Ford announced in April it was considering shedding Hertz, which it
> has owned since 1994, to concentrate on its core automotive business.
> The infusion of cash should help the automaker, which has been
> struggling with falling sport utility vehicle sales, growing U.S.
> health care costs and other issues. Ford's second-quarter profit fell
> 19 percent to $946 million.
>
> "This transaction reinforces our commitment to strengthening our
> balance sheet and investing in our core automotive business," said Don
> Leclair, Ford's chief financial officer.
>
> The deal is subject to regulatory approvals and is expected to be
> completed by year's end.
>
> Hertz plans a cash tender offer for up to $2.3 billion of outstanding
> debt securities in connection with the transaction; certain other
> Hertz debt will be refinanced.
>
> In addition, Ford Motor Credit Co., the automaker's finance arm, said
> separately it intends to file a registration statement to exchange its
> own debt securities for up to $2.4 billion of outstanding Hertz debt
> with similar terms. Such an exchange could generate cash for Ford
> Motor Credit.
>
> The transaction also involves another $4.7 billion in primarily other
> Hertz debt, a Ford spokeswoman said.
>
> Burnham Securities analyst David Healy called the deal "a reasonable
> move" for Ford, which he said can certainly use the extra cash to
> enhance new product development and offset rising health care
> expenses.
>
> "Hertz has become less and less important as an outlet for Ford cars
> as Ford has pared back sales to Hertz and other daily rental
> companies," Healy said. "It's really a noncore business right now."
>
> Still, Hertz is the world's largest general-use car rental business.
> It has been a solid contributor to Ford's bottom line, with revenue of
> $6.7 billion and net income of $365.5 million in 2004.
>
> The company, founded in 1918, rents vehicles from 7,400 locations in
> more than 150 countries, according to a recent filing with the
> Securities and Exchange Commission. In addition, Hertz is a major
> supplier of rental equipment such as tractors, dump trucks and power
> washers. Hertz rents equipment from 340 locations in North America,
> France and Spain.
>
> Hertz controlled 30 percent of the market at the 180 largest U.S.
> airports in 2004. The company has been trying to expand its
> off-airport rental business by opening neighborhood locations.
>
> The ties with Ford may not be completely severed. In July, Hertz
> agreed to continue buying and promoting Ford vehicles through August
> 2010, in exchange for Ford paying half its advertising costs each
> year. It wasn't clear whether that agreement would be kept in place.
>
> Approximately 41 percent of the vehicles Hertz acquired domestically
> in 2004 were made by Ford and its subsidiaries, according to a recent
> SEC filing.
>
> Some experts on private equity investors have said buyout firms often
> acquire companies because they think they can make them bigger players
> in the market. But because Hertz already is the world's largest
> general-use car rental agency, the firms involved in this case could
> try to streamline Hertz's management and then take the company public.
>
> Hertz, they say, is an appealing company for investors because it has
> a relatively stable cash flow.
>
> Two groups of firms had been competing for Hertz. The other was made
> up of Bain Capital, The Blackstone Group, Texas Pacific Group and
> Thomas H. Lee Partners.
>
> Yet another $.02 worth from a proud owner of a 1970 Mach 1 351C @
> http://community.webshots.com/album/18644819fHAehGJAjt
>
>
>