Simpar, the controlling shareholder of Brazil’s vehicle rental service Vamos Locacao and dealership Automob, has proposed a merger involving the two firms, it said in a corporate filing on Sunday.
The merger would have a subsidiary of Vamos that owns dealerships merge with Automob, to create a network of dealerships in Brazil.
The merger would see Vamos carve out its dealership business subsidiary Vamos Comercio de Maquinas Linha Amarela and merge it with Automob. Vamos Locacao would then be solely dedicated to the rental of trucks, machinery and equipment.
“Simpar, as controlling shareholder of Vamos Locacao and Automob, is convinced that the generation of long-term value on multiple fronts will benefit all companies involved and their shareholders,” said the firm.
The new firm would be listed under the name Automob in Brazil’s Bovespa stock exchange, said Simpar, adding it would be the first company in its segment to do so.
As a listed company, Automob would be in a position to accelerate consolidation in the sector, with the acquisition of smaller rivals, according to a person familiar with the matter.
Simpar said in the filing that it believes the restructuring may be completed by the end of the year.
Source: Reuters.com