Verra Mobility rallies after reaching new deal with Avis
VRRM•Verra Mobility reaches framework agreement with Avis Budget Group
Verra Mobility's VRRM.O shares were up 25% to $5.23 on Wednesday after the company said it reached a framework agreement with Avis Budget Group CAR.O on a new seven-year tolling and violations services contract.
VRRM shares were on course for their record daily percentage gain.
Under the agreement, Avis will be able to selectively perform certain activities internally, VRRM said late Tuesday.
Financial terms were not disclosed, but VRRM said the new agreement is expected to be materially less favorable than its prior agreement with the rental-car firm.
"Reengaging with ABG is a positive step forward for Verra Mobility that reflects the strength of our differentiated technology platform and our expertise in complex tolls and violations management for large vehicle fleets," CEO Jon Keyser said.
On May 27, VRRM's stock plunged 71% and hit a record low after receiving a contract termination notice from Avis.
On June 1, Mesa, Arizona-based VRRM named Keyser interim CEO, replacing David Roberts after his 12 years of leadership, including taking it public in Oct. 2018 after a SPAC merger.
All 8 analysts covering the stock rate it "hold"; median PT $7.50, per LSEG data.
