Driversshield.com Corp. on Oct. 30 announced that it has entered into a definitive agreement with PHH Arval, a major provider of comprehensive fleet management services and a subsidiary of Cendant Corp., whereby PHH will purchase driversshield.com's FS (Fleet Services) subsidiary for $6.3 million. PHH will also make a $1 million strategic investment in
The transaction is expected to close before the end of February 2002, subject to shareholder approval and certain other conditions.
In addition, it is contemplated that driversshield.com Corp. and PHH Arval will enter into a strategic alliance, under which PHH will provide services to both of driversshield.com Corp.'s other business units -- CRM (customer relationship management for auto insurance companies) and ADS (auto discounts and services membership programs) -- supplying information technology development and hosting, operations support and supplier network management.
The two companies say they intend to cross-market their services and share their nationwide repair networks, thereby greatly expanding both companies' coverage and opportunities.
"During the past 18 years, we have built a well established, profitable fleet business with a top-notch reputation," said Barry Siegel, chairman and CEO of driversshield.com Corp. "It has provided the impetus that has allowed
us to develop new opportunities within our expertise that have far greater growth potential for our shareholders. With considerable consolidation now occurring in the fleet services industry, PHH's overture to us was both appropriate and timely. The sale of our fleet unit will give us a unique opportunity to re-deploy that capital into those higher growth areas, particularly our CRM unit. That business is now developing real traction and has signed several important long-term exclusive contracts with insurance
companies that have very strong revenue potential for us," Siegel said.
"A strategic alliance with PHH will boost our businesses and dramatically enhance our ability to scale up our rapidly growing, Internet-based CRM business to meet the demands of our existing and new customers," Siegel said.
"PHH's extensive claims management infrastructure, experience and impeccable reputation make it an especially valuable partner. PHH's plan to make a $1 million strategic investment in driversshield.com Corp., on top of its purchase of our fleet unit, is a strong vote of confidence in our management, our business plan, and the prospects of our businesses going forward."
George Kilroy, president and CEO of PHH Arval, commented: "PHH has set its sights on growth through strategic alliances and acquisition of businesses that are complementary or adjacent to our core business. For that reason, we
approached driversshield.com Corp., whose fleet unit is a Top 10 provider of collision management services for risk managers and corporate fleets. This transaction dramatically strengthens our presence in this expanding market. driversshield.com FS will retain its own brand identity in the marketplace. In addition, PHH's strategic alliance with driversshield.com Corp. opens up new revenue streams as we leverage our core capabilities. We're excited about our future and intend to seek other acquisitions and alliances to expand and better serve our growing client base while creating more career opportunities for our employees."
Founded in 1946, PHH Arval is one of the world's largest vehicle management companies. A subsidiary of Cendant Corp., PHH Arval provides integrated leasing, management and card payment solutions to thousands of corporate, government and service-related fleets, including nearly one-third of the Fortune 500 companies.
In conjunction with Arval PHH, its joint venture partner in Europe, PHH Arval manages over a million vehicles worldwide. Through consultative expertise, personalized service and Internet technology, PHH says it helps clients reduce costs and increase productivity.
For more information about PHH, call 1-800-ONLY PHH or visit www.phh.com
About Cendant Corporation
PHH's parent company, Cendant Corp., is primarily a provider of travel and residential real estate services. Cendant's brands include such companies as Avis Rent A Car, Century 21, Coldwell Banker, Days Inn, Howard Johnson and Ramada Inn.
With approximately 57,000 employees, New
York City-based Cendant provides these services to businesses and consumers in more than 100 countries.
More information about Cendant, its companies, brands and current SEC filings may be obtained by visiting www.Cendant.com
or by calling 877-4INFO-CD (877-446-3623).
About driversshield.com Corp.
Since its founding in 1983, driversshield.com says it has built a national reputation for efficient, cost-saving management of collision claims for self-insured corporate and municipal vehicle fleets through its subsidiary, driversshield.com FS (Fleet Services).
Clients include AT&T, CVS, Time Warner, Lucent Technologies, Hershey Foods and other national and international companies.
Through its affinity auto club programs, the company has established relationships with Assurant Group (part of the Fortis group), Aon,
Protective Life and other leading credit card, financial organizations and Web sites.
The Company decided early in 1999 to expand its long established auto claims experience and proprietary systems by building a unique e-commerce solution for insurance companies, the driversshield.com CRM business. Its CRM
clients include Employers Insurance of Wausau, Farmers Alliance Mutual Insurance and The St. Paul Companies.
More information about driversshield.com can be obtained by visiting www.driversshield.com
or by calling (516) 694-1010.