01—Abstract
Summary
Summary of the 8-K filed December 21, 2011. Cited figures are marked; the original filing is the authoritative source.
United Rentals, Inc. (URI) announced a significant development in a Form 8-K filing dated December 21, 2011, detailing a definitive Agreement and Plan of Merger with RSC Holdings Inc. (RSC).
The transaction, unanimously approved by both companies' boards, will see RSC merged into United Rentals, with United Rentals as the surviving entity. This strategic move aims to enhance United Rentals' market position and operational scale. The merger consideration will consist of a combination of cash and United Rentals' common stock for each outstanding share of RSC common stock.
The filing also outlines the robust financing arrangements in place, including committed debt financing from multiple lenders, to fund the cash portion of the transaction, repay certain indebtedness, and cover associated fees. The acquisition is subject to customary closing conditions, including stockholder and regulatory approvals, and is expected to be a transformative event for the company.
02—Key points
Key Highlights
- United Rentals, Inc. (URI) has entered into a definitive Agreement and Plan of Merger with RSC Holdings Inc.
- The transaction is structured as a merger of RSC into United Rentals, with United Rentals as the surviving corporation.
- RSC stockholders will receive $10.80 in cash and 0.2783 shares of United Rentals common stock per RSC share.
- The boards of directors of both United Rentals and RSC have unanimously approved the merger agreement.
- The company has secured committed debt financing totaling $2.2 billion ($650 million senior secured, $1.55 billion senior unsecured bridge facilities) to fund the transaction.
- Completion of the merger is contingent upon obtaining necessary stockholder and regulatory approvals, including HSR clearance.
- The Oak Hill Stockholders, holding approximately 33.4% of RSC's common stock, have entered into a voting agreement to support the merger.
03—Questions
Frequently Asked Questions
What is the primary purpose of this 8-K filing for United Rentals?
This Form 8-K filing announces a material definitive agreement, specifically the Agreement and Plan of Merger between United Rentals, Inc. and RSC Holdings Inc. It provides key details about the terms of the merger, the consideration to be paid to RSC shareholders, financing arrangements, and conditions for closing.
What is the financial consideration for RSC Holdings Inc. shareholders?
Each outstanding share of RSC common stock will be converted into $10.80 in cash and 0.2783 shares of United Rentals' common stock, without interest. The agreement also outlines termination fees and expense reimbursement provisions under specific circumstances.
How is United Rentals financing this acquisition?
United Rentals has secured debt financing commitments totaling $2.2 billion. This includes a $650 million senior secured bridge facility and a $1.55 billion senior unsecured bridge facility. The company also plans to issue senior secured and unsecured notes to potentially replace some or all of the bridge financing, and is seeking amendments to its existing revolving credit facility.
What are the key conditions for the merger to be completed?
The consummation of the merger is subject to several conditions, including the approval of the merger agreement by the stockholders of both United Rentals and RSC, the expiration or termination of waiting periods under antitrust laws (like HSR in the US and Competition Act in Canada), the listing of United Rentals' shares on the NYSE, and the effectiveness of a registration statement for the shares being issued. Conditions also include the accuracy of representations and warranties, compliance with covenants, and the absence of material adverse changes for both companies.
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