Volkswagen is interested in taking over Europcar, according to Insider. The French car rental company is fighting the consequences of the corona pandemic.
Volkswagen is interested in taking over the French car rental company Europcar. In a first step, the Wolfsburg-based investment banks have switched to examine a possible takeover, it said on Wednesday from industry circles. A group spokesman declined to comment.
Financial investors are also said to have kept an eye on the French car rental company, including the American investment and investment company Apollo. The largest single shareholder of Europcar with almost 30 percent of the shares is the French financial investor Eurazeo. The finance agency Bloomberg first reported on the takeover simulation games from Volkswagen. At the Paris stock exchange, Europcar paper increased by up to 17 percent.
The group planners in Wolfsburg were always on the lookout for companies that were suitable for a takeover, according to reports from company circles. Volkswagen can open up new business areas with Europcar. However, it is anything but certain whether VW will decide to take over or take a larger stake in the French car rental company. The considerations for this are just beginning. Because of the burdens resulting from the corona pandemic, the Wolfsburg-based car company also had to survive very precisely where it used its financial resources in the current situation.
Car rental companies are currently going through a difficult time. Because of the corona pandemic, worldwide travel is extremely restricted. Business trips are canceled, tourists have to do without the planned vacation. As a result, the booking figures for rental cars have plummeted. The US car rental company Hertz had to file for bankruptcy a few days ago due to the corona-related drop in sales.
Additional sales channel
Should VW choose Europcar, it would be a bet to revive the rental business after the end of the corona crisis. “An additional sales channel would open up to us,” said a VW manager in Wolfsburg. Car rental companies take tens of thousands of vehicles from manufacturers.
With car rental companies, leasing to private customers is also gaining in importance. A new leasing market is just emerging for the first generation of fully electric cars. Volkswagen could build the leasing business for electric cars with private customers through a car rental company like Europcar. The VW group could also use the dense network of Europcar rental stations to broaden its range as a mobility provider.
In addition, a purchase of Europcar for VW would be a bargain. The corona crisis has significantly reduced the car rental company’s market value. The company is currently worth around 400 million euros on the Paris stock exchange. Despite the pandemic, VW would have no problem raising the amount for Europcar due to its cash holdings. At the end of the first quarter, Volkswagen had a net liquidity of around 17 billion euros on the books.
VW is also very familiar with Europcar: the Wolfsburg-based company sold the car rental company to Eurazeo in 2006 for a good 3.3 billion. VW justified the withdrawal at the time by saying that the group wanted to concentrate on its core business. Europcar recently secured a financing package of more than 300 million euros to get through the crisis. This includes a loan of 220 million euros, 90 percent of which is guaranteed by the French state.