Hertz Global Holdings Inc., or Hertz, has filed its initial SEC Form 10 registration statement detailing the planned separation of its equipment rental business as a stand-alone, publicly traded company.
No record date has been set, though the company has said it expects the transaction to be completed by the end of the second quarter of 2016. The separation is expected to be a tax-free event for U.S. federal income tax purposes to shareholders.
"We've taken a number of actions this year to drive performance and preparing the equipment rental business to operate as a stand-alone company is among the most significant," said John Tague, Hertz president and chief executive officer. "There are fundamental differences in the business models for vehicle versus equipment rental, and we believe the separation will enable more distinct focus on each by the respective separate management teams, as well as provide the equipment rental business with direct access to capital markets.
"Over the course of this year, we've put in place a highly capable senior management team that is ready to successfully operate and grow the equipment business, as well as run a publicly-traded company, based on decades of experience. The team has made significant progress, including a year-over-year 14 percent revenue increase in non-oil and gas markets in the third quarter, and we believe they are positioned to succeed in the long term," Tague added.
The leadership team for the Hertz equipment rental business includes:
Larry Silber, president and chief executive officer, whose background includes 30 years with Ingersoll Rand, where he led major business groups including utility equipment, rental and remarketing and the equipment and services businesses. Most recently, Silber was executive advisor at Court Square Capital Partners, LLP.
Barbara Brasier, who joined the business in November 2015 as chief financial officer. Before joining the equipment rental business, Brasier was senior vice president, tax and treasury for Mondelez International, Inc.
Maryann Waryjas, who also joined the business in November 2015 as general counsel. Waryjas previously was senior vice president, chief legal officer and corporate secretary for Great Lakes Dredge & Dock Corporation, one of the largest providers of dredging services in the United States. She has more than 30 years of corporate governance, securities, and mergers and acquisitions experience, including as a partner in major national law firms.
Bruce Dressel, who joined the business as chief operating officer in June 2015. Dressel brings more than 30 years in leadership and senior management roles in the equipment rental industry, including time as president and CEO of Sunbelt Rentals, where the company grew from 24 to 195 locations during his tenure there.
Rich Marani, who joined the business in June 2015 as chief technology officer. Marani has more than 30 years IT experience in industrial products, construction equipment, aerospace and information technology businesses. Recently, Marani served in a senior IT leadership role with Ingersoll Rand, responsible for global IT strategy for a $3 billion sector of the Ingersoll portfolio.
Chris Cunningham, who joined the business in September 2014 as chief human resources officer. Cunningham has significant, senior-level experience in the initial public offering process, talent acquisition, board relations, performance management, governance, and international and field operations. He joined the business from DFC Global Corporation.
"The filing of the Form 10 is a significant milestone on our path toward the separation of the equipment rental business as a stand-alone company," said Larry Silber, president and chief executive officer of Hertz Equipment Rental Corporation. "We are confident that our separation from Hertz Global Holdings will provide us better flexibility and focus to pursue growth opportunities within our core equipment rental markets, which also will enable us to provide better value to our customers, employees, and suppliers."
Hertz's equipment rental business is one of the largest players in the North American equipment rental industry with more than 50 years of equipment-rental expertise. With approximately 4,500 employees, the business has 280 company-operated branches, of which 270 are in the United States and Canada, and the remaining branches are located in the United Kingdom, China and through joint venture arrangements in Saudi Arabia and Qatar. In addition, the business operates through 14 franchisee owned branches in Greece, Iceland, Portugal, and Corsica in Europe; in Afghanistan in the Middle East; in Panama in Central America; and in Chile in South America.
Hertz Equipment Rental Corporation is a leading, full-line equipment-rental supplier in key markets, including civil infrastructure, industrial and manufacturing, oil and gas, government and municipalities, commercial and residential construction, mining, energy, remediation, emergency response, facilities, entertainment, and ground care.
Hertz also disclosed in the filing that it repurchased 22.2 million of its shares during the fourth quarter of 2015 for $343 million under its share repurchase program.