Avis Budget Group to guarantee $1 billion notes issued by Avis Budget Car Rental

By Jennifer Chiou

New York, Feb. 9 - Avis Budget Group, Inc. announced that it has agreed to guarantee the principal and interest on the $1 billion of senior notes issued by its Avis Budget Car Rental subsidiary in April 2006.

The securities include Avis Budget Car Rental's 7 5/8% senior notes due 2014, 7¾% senior notes due 2016 and floating-rate senior notes due 2014.

In return, the company received $14 million from institutional investors in a transaction arranged by Deutsche Bank Securities Inc.

The Parsippany, N.J., car rental business operator added that as a result of the guarantee, under the rules of the Securities and Exchange Commission it will continue to file periodic reports, but does not expect that periodic reports will be required for any of its subsidiaries.

Avis noted that it expects to achieve cost savings as a result of filing periodic reports for just one issuer.

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