Contractors are cutting overhead expenses by trimming debt, licensing fees, taxes, insurance and maintenance costs by renting equipment. United Rentals has benefitted, with $2.61 billion in 2011 revenue that was a 16.7% increase over 2010. Rental rates are up 6.1% and time utilization is at 69.1%.
These conditions prompted the nation's largest rental company to acquire rival RSC Holdings Inc. for $1.87 billion in cash and stock, plus $2.3 billion in debt. United will buy back $200 million of its common stock once the merger deal closes on April 30. The company plans to initiate an across-the-board 5% rental rate increase in 2012 to help pay for the stock purchase.
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