Hertz Global Holdings has expanded its Hertz entertainment Services operation with the acquisition of Cinelease. The Los Angeles-based company is identified as the US market leader in lighting and grip rentals to the television industry.
Hertz became a big player in the business a little over a year ago when it acquired 24/7 Studio Equipment.
“With the acquisition of Cinelease, Hertz Entertainment Services becomes the leading provider of lighting and grip rentals to the U.S. television industry, which is one of the fastest growing segments of our economy,” said Mark P. Frissora, Hertz Chairman and CEO. “Cinelease aligns with Hertz’s growth and diversification strategy to meet the equipment rental needs of a broad range of leading industries. The acquisition expands our footprint in another specialty rental market with higher revenue growth and margins, longer rentals and lower seasonal cyclicality.”
The CEO said Cinelease will add at least 3% of incremental, inorganic revenue growth to Hertz’s global equipment rental revenues in 2012. The acquisition is said to be both accretive to earnings and cash flow-positive in year one.
“Additionally, Cinelease will accelerate the growth of our Entertainment Services business because Hertz is uniquely able to bundle a wide variety of products for film and television production companies, from lights, grip, generators, cranes and lifts to the widest selection of rental cars in the industry,” Frissora said.
Hertz said buying Cinelease complements the earlier acquisitions of First Call and 24/7 which also provide rental equipment, including aerial and forklifts, to the entertainment industry.
According to the announcement, lighting and grip rental revenues generated by the US television and movie industry are estimated at $600 million annually. It is anticipated by Hertz that Cinelease will deliver approximately $50 million of new revenues during 2012 as the company is integrated into Hertz Entertainment Services.