The company behind Century 21 real estate and Days Inn hotels is considering buying the Avis car rental company in a deal that could top $1 billion, The Wall Street Journal reported Monday.
HFS Inc. is in preliminary talks with the employee-owned Avis Inc., sources close to the negotiations told the Journal.Neither company would comment, the Journal said, but last week, Avis Chairman Joseph Vit-toria told employees at a meeting in Virginia that their company had received an "unsolicited indication of interest" from a publicly traded company.
Avis, based in Garden City, N.Y., is controlled by an employee stock-ownership plan. But any offer would also have to be approved by General Motors Corp., which owns nonvoting preferred stock convertible into a 29 percent stake and has a long-term fleet supply agreement with Avis.
The sources said HFS hasn't yet made an offer acceptable to the automaker, which also declined to comment.
Sources told the newspaper HFS is particularly interested in Avis' reservations service, considered one of the best in the industry, and the advantages for HFS in the hotel business are obvious.
HFS, of Parsippany, N.J., franchises 5,200 hotels in eight chains, including Days Inn, Howard Johnson and Ramada. Last year, HFS bought the Century 21 and Electronic Realty Associates real estate brokerages.