e425
Filed by United Rentals
pursuant to Rule 425 under the
Securities Act of 1933, as amended.
Subject of the offer: RSC Holdings
(Commission File No.: 001-33485)
UNITED RENTALS TO ACQUIRE RSC HOLDINGS
Combined Company expected to have enhanced growth prospects and
a more attractive business mix
Transaction expected to generate over $200 million of annual cost savings, with
additional revenue and cash flow upside
Transaction is expected to be accretive to United Rentals Cash EPS in the first full year
after closing and provide significant value to United Rentals and RSC stockholders
Board intends to authorize up to $200 million in stock buyback after close
GREENWICH, Conn. and SCOTTSDALE, Ariz., December 16, 2011 United Rentals, Inc. (NYSE: URI)
(United Rentals) and RSC Holdings, Inc. (NYSE: RRR) (RSC) today announced that they have
entered into a definitive merger agreement under which United Rentals will acquire RSC in a
cash-and-stock transaction valued at $18.00 per share, or a total enterprise value of $4.2 billion,
including $2.3 billion of net debt. The Boards of Directors of both companies have unanimously
approved the proposed transaction and recommended that their respective stockholders approve the
proposed transaction.
The proposed transaction will create a leading North American equipment rental company with a more
attractive business mix, greater scale and enhanced growth prospects. The combination is also
expected to accelerate United Rentals growth with industrial customers as well as provide a lower
cost base and a less volatile revenue profile to better position the company through all phases of
the business cycle. The new United Rentals is well-positioned to benefit from increased rental
penetration, the continued strength of the industrial sector, serving customers across a variety of
industries and a recovery in construction activity. United Rentals and RSC have already begun
working on a plan to facilitate a smooth integration of the businesses and realization of over $200
million of potential cost savings.
Michael Kneeland, President and Chief Executive Officer of United Rentals said, This transaction
marks a transformative moment in our companys history. Combining the experience and resources of
two top performing equipment rental companies creates an exceptional company. The new United
Rentals will build upon the best practices and management teams from both companies to deliver
superior customer benefits and enhanced value for our stockholders. With the best talent in the
industry, we have a tremendous opportunity to become the supplier of choice for customers
throughout North America.
Erik Olsson, RSCs Chief Executive Officer and President, said, RSC has a strong track record of
profitable growth and we are proud of what we have built. At the same time, I am confident that by
partnering with United Rentals we can accomplish far more than either company could have achieved
on its own, including significant synergies. As a result, the transaction delivers significant
value to our shareholders. Our similar customer-centric cultures and commitment to operational
excellence will provide even greater value to our customers and facilitate a smooth integration. I
look forward to helping to lead the integration process during a transition period.
Upon the close of the transaction, three of RSCs independent directors will receive seats on
United Rentals existing Board of Directors.
Michael Kneeland, President and Chief Executive Officer of United Rentals, and Jenne Britell,
United Rentals Chairman, will remain in their positions at the combined company.
Transaction Highlights
Upon the closing of the transaction, each outstanding share of RSC common stock will be converted
into the right to receive $10.80 in cash and 0.2783 of a share of United Rentals common stock,
subject to the terms and conditions of the merger agreement.
The transaction provides immediate value to RSC stockholders through the cash component, as well as
continued participation in future value creation of United Rentals through their ownership of
approximately 30% percent of United Rentals on a fully diluted basis. The price of $18.00 per share
represents a 58% premium over RSCs closing price as of December 15, 2011.
The cash portion of the transaction will be financed through new debt issuance and drawing on
current loan facilities. United Rentals has obtained financing commitments from Morgan Stanley
Senior Funding Inc., Bank of America Merrill Lynch and Wells Fargo in support of this transaction.
By the end of 2012, the combined companys leverage ratio is expected to be in line with United
Rentals previously stated target range of 3.5x 4.5x. As a result, United Rentals expects to
retain its current corporate credit ratings. United Rentals intends to re-pay the outstanding
amounts on RSCs existing Senior Secured Credit Facilities and Senior Secured Notes due 2017, and
assume all of RSCs existing unsecured debt.
United Rentals Board also announced its intention to authorize after closing a stock buyback of up
to $200 million of the Companys common stock. United Rentals current intention is to complete the
stock buyback within six to twelve months after closing.
The deal is expected to be accretive to United Rentals cash earnings per share in the first full
year after closing. The transaction is anticipated to provide over $200 million of annual cost
savings through the elimination of redundant infrastructure, branches and overhead, two thirds of
which are expected to be achievable within the first twelve months following the closing of the
transaction. The combination is also expected to provide meaningful revenue synergies from the
expanded footprint, in particular with national and industrial account relationships and provide
additional cash flow upside through optimization of the combined fleet and capital expenditures.
The proposed transaction is subject to the conditions of delivery of tax opinions and a solvency
opinion as well as customary closing conditions, including approval by United Rentals and RSC
stockholders, absence of a United Rentals and RSC material adverse effect and notification and
clearance under certain antitrust statutes. United Rentals and RSC expect the transaction to close
in the first half of 2012.
Oak Hill Capital Partners has agreed to vote its 33.5% shareholding in RSC in favor of the
transaction.
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Special meetings of the United Rentals and RSCs respective stockholders will be held as soon as
practicable after the preparation and mailing of the joint proxy statement/prospectus to be
included in the registration statement on Form S-4 to be filed by United Rentals to register the
shares of United Rentals common stock issuable in connection with the proposed transaction with the
Securities and Exchange Commission and the subsequent mailing to United Rentals and RSCs
respective stockholders. The joint proxy statement/prospectus is expected to be mailed as promptly
as practicable after the effectiveness of this registration statement.
Centerview Partners and Morgan Stanley & Co. LLC acted as financial advisors to United Rentals, and
Sullivan & Cromwell LLP acted as the Companys legal advisor. Barclays Capital and Goldman, Sachs &
Co. were lead financial advisors to RSC, and Deutsche Bank also provided financial advice. Paul,
Weiss, Rifkind, Wharton & Garrison LLP and Debevoise & Plimpton LLP acted as RSCs legal advisors.
Conference Call / Webcast
United Rentals and RSC will hold an analyst and investor conference call/webcast today, Friday,
December 16, at 8:00 a.m. ET to discuss the proposed acquisition. The webcast can be accessed on
the investor relations sections on the two companies websites http://www.ur.com/investor and
http://investor.rscrental.com. You can also listen to the conference call by dialing either (888)
874-9470 in the United States or (973) 935-8772 outside of the United States. Please reference
conference ID 36465372.
A replay of the call will be available within 24 hours.
Contacts
For United Rentals:
Fred Bratman
Senior Vice President of Investor Relations and Corporate Communications
Office: (203) 618-7318
Cell: (917) 847-4507
fbratman@ur.com
Steve Lipin / Stan Neve
Brunswick Group
(212) 333-3810
For RSC Holdings:
Investor/Analyst Contacts:
Scott Huckins
Vice President Treasurer
(480) 281-6956
scott.huckins@rscrental.com
Media Contact:
Chenoa Taitt
Rooney & Associates
(212) 223-0682
ctaitt@rooneyco.com
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About United Rentals
United Rentals, Inc. (United Rentals) is the largest equipment rental company in the world, with
an integrated network of 541 rental locations in 48 states and 10 Canadian provinces. The companys
approximately 7,500 employees serve construction and industrial customers, utilities,
municipalities, homeowners and others. The company offers for rent approximately 2,900 classes of
equipment with a total original cost of $4.26 billion. United Rentals is a member of the Standard &
Poors MidCap 400 Index and the Russell 2000 Index® and is headquartered in Greenwich, Conn.
Additional information about United Rentals is available at www.unitedrentals.com.
About RSC Holdings
RSC Holdings Inc. (NYSE: RRR) (RSC Holdings) based in Scottsdale, Arizona, is the holding company
for the operating entity RSC Equipment Rental, Inc. (RSC), which is a premier provider of rental
equipment in North America, servicing the industrial, maintenance and non-residential construction
markets with $2.7 billion of equipment at original cost. RSC offers superior equipment
availability, reliability and 24x7 service to customers through an integrated network of 452 branch
locations across 42 states in the United States and three provinces in Western Canada. Customer
solutions to improve efficiency and reduce cost include the proprietary Total Control® rental
management software, Mobile Tool Rooms and on-site rental locations. With over 4,600 employees
committed to safety and sustainability, RSC delivers the best value and industry leading customer
service. All information is as of September 30, 2011. Additional information about RSC is available
at www.RSCrental.com.
Cautionary Statement Regarding Forward-Looking Statements
This document contains forward-looking statements within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended, and in the Private Securities Litigation Reform Act of
1995, known as the PSLRA. These statements, as they relate to United Rentals or RSC Holdings, the
management of either such company or the transaction, involve risks and uncertainties that may
cause results to differ materially from those set forth in the statements. These statements are
based on current plans, estimates and projections, and, therefore, you should not place undue
reliance on them. No forward-looking statement can be guaranteed, and actual results may differ
materially from those projected. United Rentals and RSC Holdings undertake no obligation to
publicly update any forward-looking statement, whether as a result of new information, future
events or otherwise. Forward-looking statements are not historical facts, but rather are based on
current expectations, estimates, assumptions and projections about the business and future
financial results of the equipment rental industries, and other
legal, regulatory and economic developments. We use words such as anticipates, believes,
plans, expects, projects, future, intends, may, will, should, could, estimates,
predicts, potential, continue, guidance and similar expressions to identify these
forward-looking statements that are intended to be covered by the safe harbor provisions of the
PSLRA. Actual results could differ materially from the results contemplated by these
forward-looking statements due to a number of factors, including, but not limited to, those
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described in the documents United Rentals and RSC Holdings have filed with the U.S. Securities and
Exchange Commission as well as the possibility that (1) United Rentals and RSC Holdings may be
unable to obtain stockholder or regulatory approvals required for the proposed transaction or may
be required to accept conditions that could reduce the anticipated benefits of the merger as a
condition to obtaining regulatory approvals; (2) the length of time necessary to consummate the
proposed transaction may be longer than anticipated; (3) problems may arise in successfully
integrating the businesses of United Rentals and RSC Holdings; (4) the proposed transaction may
involve unexpected costs; (5) the businesses may suffer as a result of uncertainty surrounding the
proposed transaction; and (6) the industry may be subject to future risks that are described in the
Risk Factors section of the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and other
documents filed from time to time with the Securities and Exchange Commission by United Rentals and
RSC Holdings. United Rentals and RSC Holdings give no assurance that it will achieve its
expectations and does not assume any responsibility for the accuracy and completeness of the
forward-looking statements.
The foregoing list of factors is not exhaustive. You should carefully consider the foregoing
factors and the other risks and uncertainties that affect the businesses of United Rentals and RSC
Holdings described in the Risk Factors section of their respective Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and other documents filed from time to time with the Securities and
Exchange Commission. All forward-looking statements included in this document are based upon
information available to United Rentals and RSC Holdings on the date hereof; and United Rentals and
RSC Holdings assumes no obligations to update or revise any such forward-looking statements.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
This press release relates to a proposed transaction between United Rentals and RSC Holdings, which
will become the subject of a registration statement and joint proxy statement/prospectus forming a
part thereof to be filed with the SEC by United Rentals. This press release is not a substitute for
the registration statement and joint proxy statement/prospectus that United Rentals will file with
the SEC or any other documents that they may file with the SEC or send to shareholders in
connection with the proposed transaction. BEFORE MAKING ANY VOTING DECISION, INVESTORS AND SECURITY
HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, JOINT PROXY STATEMENT/PROSPECTUS AND ALL
OTHER RELEVANT DOCUMENTS FILED OR THAT WILL BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED
TRANSACTION AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED TRANSACTION.
You will be able to obtain a free copy of the joint proxy statement/prospectus, as well as other
filings containing information about United Rentals and RSC Holdings, at the SECs Internet site
(http://www.sec.gov). You will also be able to obtain these documents, free of charge, in the
Investor Relations portion of the United Rentals website at http:// http://www.ur.com/investor
under the heading Investors and then under SEC Filings. Copies of the joint proxy
statement/prospectus and the SEC filings that will be incorporated by reference in the joint proxy
statement/prospectus can also be obtained, free of charge, by directing a request to Investor
Relations at 203-618-7318.
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Participants in Solicitation
United Rentals, RSC Holdings and their respective directors and executive officers and certain
members of management and employees may be deemed to be participants in the solicitation of proxies
from the stockholders of United Rentals and RSC Holdings in connection with the proposed
transaction. Information about the directors and executive officers of United Rentals and their
ownership of United Rentals common stock is set forth in the proxy statement for the United Rentals
2011 annual meeting of stockholders, as filed with the SEC on Schedule 14A on March 31, 2011.
Information about the directors and executive officers of RSC Holdings and their ownership of RSC
Holdings common stock is set forth in the proxy statement for the RSC Holdings 2011 annual meeting
of stockholders, as filed with the SEC on Schedule 14A on March 16, 2011. Additional information
regarding the interests of those persons and other persons who may be deemed participants in the
proposed transaction may be obtained by reading the joint proxy statement/prospectus regarding the
proposed transaction when it becomes available. You may obtain free copies of this document as
described in the preceding paragraph.
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