OREANDA-NEWS. Avis Budget Group, Inc. (NASDAQ: CAR), a leading global provider of vehicle rental and car sharing services, today announced that its Board of Directors has adopted a short-term stockholder rights plan that will enable the Company to continue to engage in substantial share repurchases without subjecting it to the potential risk of "creeping control" that could harm stockholders.

SRS Investment Management ("SRS") has disclosed an approximately 28.5% economic interest in Avis Budget Group, including voting power over approximately 9.7% of the outstanding shares and economic exposure to an additional approximately 18.8% of the outstanding shares through cash-settled derivative instruments and options. Avis Budget Group has repurchased over $1 billion of its shares over the past three years, reducing shares outstanding by approximately 20%. As announced on November 14, 2016, the Company has again increased its share repurchase authorization by $250 million and expects to repurchase a significant amount of shares in 2017.

The Company and SRS entered into an agreement in January 2016 which contains standstill provisions which expire January 25, 2017, as well as SRS board representation which continues. SRS has been unwilling to agree to customary standstill provisions going forward.

To keep any party from obtaining effective control of Avis Budget Group without paying a control premium, and to prevent the ability to effectively block strategic actions that may be in stockholders’ interests, the Board believes it is in the best interests of the Company and all of its stockholders to implement a short-term rights plan. The rights plan is not intended to prevent – and is designed to ensure that stockholders have a fair opportunity to consider – any action with respect to the Company (including its acquisition) that the Board determines to be in the best interests of stockholders and is not being adopted in response to any specific action or proposal. The Board and management remain highly committed to taking actions that are in the best interests of the Company and all of its stockholders and maximizing longterm stockholder value, including through further share repurchases which to date have been met with support by the Company’s stockholders.

The rights will initially trade with the Company’s common stock and will generally become exercisable only if any person (or any persons acting in concert or as a group) acquires a voting or economic position in 10% or more of the Company’s outstanding common stock (the "triggering percentage"). If the rights become exercisable, all holders of rights (other than any triggering person) will be entitled to acquire shares of common stock at a 50% discount or the Company may exchange each right held by such holders for one share of common stock. Under the rights plan, any person (including SRS) which currently owns more than the triggering percentage (an "existing holder") may continue to own its shares of common stock but may not acquire a voting or economic interest in any additional shares without triggering the rights plan. The conversion or exchange by an existing holder of any derivative or other economic interest in the Company into voting power will cause the rights to become exercisable if the existing holder’s beneficial ownership exceeds the triggering percentage.

The rights plan expires on January 22, 2018 and will not be renewed without also seeking stockholder approval. The rights plan may also be terminated, or the rights may be redeemed, prior to the scheduled expiration of the rights plan under certain other circumstances. Further details of the rights plan will be contained in a Form 8-K that the Company will file with the Securities and Exchange Commission.