United Rentals Inc. said it has agreed to buy rival RSC Holdings Inc. for about $1.9 billion in cash and stock in a combination of equipment rental companies. United Rentals, said the deal is expected to accelerate its growth with industrial customers, lower costs and provide a less volatile revenue stream. It said it has already identified $200 million in potential cost savings. The $18-per-share price is a 58 percent premium to RSC's closing price on Thursday 12/15/11. The deal has been approved by both companies' boards and is expected to be completed in the first six months of 2012.
When the deal closes, 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. To help finance it, United plans to buy back up to $200 million in stock within six to twelve months after the close.
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