Hertz 2011 Annual Report Download - page 117

HERTZ GLOBAL HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1—Background
Hertz Global Holdings, Inc., or ‘‘Hertz Holdings,’’ is our top-level holding company. The Hertz
Corporation, or ‘‘Hertz,’’ is our primary operating company and a direct wholly-owned subsidiary of
Hertz Investors, Inc., which is wholly-owned by Hertz Holdings. ‘‘We,’’ ‘‘us’’ and ‘‘our’’ mean Hertz
Holdings and its consolidated subsidiaries, including Hertz.
We are a successor to corporations that have been engaged in the car and truck rental and leasing
business since 1918 and the equipment rental business since 1965. Hertz was incorporated in Delaware
in 1967. Ford Motor Company, or ‘‘Ford,’’ acquired an ownership interest in Hertz in 1987. Prior to this,
Hertz was a subsidiary of United Continental Holdings, Inc. (formerly Allegis Corporation), which
acquired Hertz’s outstanding capital stock from RCA Corporation in 1985. Hertz Holdings was
incorporated in Delaware in 2005 and had no operations prior to the Acquisition (as defined below).
On December 21, 2005, investment funds associated with or designated by:
• Clayton, Dubilier & Rice, Inc., or ‘‘CD&R,’’
• The Carlyle Group, or ‘‘Carlyle,’’ and
• BAML Capital Partners, or ‘‘BAMLCP’’ (formerly known as Merrill Lynch Global Private Equity),
or collectively the ‘‘Sponsors,’’ acquired all of Hertz’s common stock from Ford Holdings LLC. We refer
to the acquisition of all of Hertz’s common stock by the Sponsors as the ‘‘Acquisition.’’
In January 2009, Bank of America Corporation, or ‘‘Bank of America,’’ acquired Merrill Lynch & Co., Inc.,
the parent company of BAMLCP. Accordingly, Bank of America is now an indirect beneficial owner of our
common stock held by BAMLCP and certain of its affiliates.
In March 2011, the Sponsors sold 50,000,000 shares of their Hertz Holdings common stock to Goldman,
Sachs & Co. as the sole underwriter in the registered public offering of those shares.
As a result of our initial public offering in November 2006 and subsequent offerings in June 2007, May
2009, June 2009 and March 2011, the Sponsors reduced their holdings to approximately 38% of the
outstanding shares of common stock of Hertz Holdings.
On September 1, 2011, Hertz completed the acquisition of Donlen Corporation, or ‘‘Donlen,’’ a leading
provider of fleet leasing and management services. See Note 3—Goodwill and Other Intangible Assets.
In December 2011, Hertz purchased the noncontrolling interest of Navigation Solutions, L.L.C., thereby
increasing its ownership interest from 65% to 100%.
Note 2—Summary of Significant Accounting Policies
Principles of Consolidation
The consolidated financial statements include the accounts of Hertz Holdings and our wholly-owned
and majority-owned domestic and international subsidiaries. All significant intercompany transactions
have been eliminated.
Use of Estimates and Assumptions
The preparation of financial statements in conformity with accounting principles generally accepted in
the United States of America, or ‘‘GAAP,’’ requires management to make estimates and assumptions that
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