Cendant
Encyclopedia
Cendant Corporation was a New York
-based provider of business and consumer services, primarily within the real estate and travel industries. In 2005 and 2006, Cendant broke up and spun off or sold its constituent businesses. Although the company was based in New York City
, the majority of Cendant's headquarters employees were located in Parsippany-Troy Hills, New Jersey.
The last CEO of Cendant was Henry Silverman.
, a business executive and private equity
investor created Hospitality Franchise Systems (HFS) as a vehicle to acquire a number of hotel franchises in the early 1990s. Among Silverman’s purchases were such brands as Ramada
and Howard Johnson's
as well as Days Inn
, which he was able to buy for $290 million (almost half what he had sold it for) after the company had filed for bankruptcy in 1991. Silverman quickly took Hospitality Franchise Systems public in a 1992 IPO.
HFS was among the fastest growing companies of its size in the 1990s and the company’s stock had risen from its IPO price of $4 per share to $77 per share by 1998. In 1996, Cendant purchased Sierra On-Line
and Davidson & Associates
for $2.2 billion. However in 1998, Henry Silverman
led HFS into what would prove a disastrous merger with CUC International
, a direct marketing company that operated Shoppers Advantage and Travelers Advantage (now part of Affinion Group). The $14 billion merger of HFS and CUC resulted in the formation of Cendant Corporation, which was formed in December 1997. Also, as part of the merger, Silverman announced he would reduce his day-to-day involvement with the company and assume the company’s chairmanship in preference of CUC’s founder and CEO Walter Forbes
.
Just months after the merger, in April 1998 Cendant uncovered massive accounting improprieties at CUC which resulted in one of the largest financial scandals of the 1990s. At the time, Vice Chairman E. Kirk Shelton, had inflated the company's revenue by $500 million over a period of three years. When this report was released to the public, the resulting damage to the market value for the company was approximately $14 billion, with their stock tumbling from a high of $41 down to nearly $12. At the time, this fiasco was the largest case of accounting fraud in the country's history. Mr. Shelton is now serving a 10 year prison sentence. Former CEO Walter Forbes
was sentenced to 12 years in prison in 2007. After the accounting scandal was uncovered, Silverman and the Cendant board forced Forbes’ resignation and Silverman assumed the CEO post. Under Silverman, Cendant bounced back from the accounting scandal far outperforming the markets in the early 2000s.
was sold for $1 billion to French publisher Havas
in 1998, the same year Havas was purchased by Vivendi
.
Early in 2004, Cendant acquired the trademark rights to the Ramada brand in the United States, where there were 819 franchised properties. It also acquired the Canadian rights. On September 15, 2004, Cendant purchased the Ramada
International Hotels & Resorts unit from Marriott International
. At the time, this was primarily a franchised brand of 204 hotels operating in 26 countries and territories.
On September 29, 2004, Cendant purchased Orbitz
for $1.2 billion.
In early 2005, Cendant purchased ebookers
for just under £190 million. Later in the year, Cendant acquired London based Gullivers Travel Associates.
, Travel Distribution
, Hospitality
and Vehicle Rental Companies
."
Cendant originally decided to spin off its Travel Distribution division as a separate company called Travelport
, but on June 30, 2006, Cendant announced the sale of Travelport to an affiliate of the privately held Blackstone Group
for $4.3 Billion. This sale closed on August 23, 2006.
During the fall of 2005 Progeny Marketing Innovations and Trilegiant were sold to private equity group Apollo Management
. They changed their name in January 2006 to Affinion Group.
On July 31 of 2006, both the Cendant Real Estate division as well as the Cendant Hospitality division were spun off and became separate companies under the names Realogy
and Wyndham Worldwide
, respectively. Realogy was subsequently bought by Apollo.
The Cendant Car Rental Group, which owns Avis, Budget Rent A Car
and Budget Truck Rental
rental companies, became the sole remaining company under the Cendant name. The company changed its name to Avis Budget Group
and the Cendant name has been completely dissolved.
Former shareholders of Cendant received as a dividend for each share of Cendant common stock held on the dividend distribution date 1/4 share of common stock of Realogy, 1/5 share of common stock of Wyndham Worldwide and the remaining shares were subject to a reverse split resulting in shareholders receiving 1 share of Avis Budget Group for each 10 shares of Cendant previously held.
, holding these properties in the CCRG (Cendant Car Rental Group). Avis and Budget operate a shared fleet of cars, and have the same "back end" system, but operate at different locations, offer different service levels, and have somewhat different pricing. After the Cendant name was dissolved, the car rental segment became known as Avis Budget Group
and currently trades on the NASDAQ
stock exchange under the ticker symbol: CAR.
.
banner.
.
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
-based provider of business and consumer services, primarily within the real estate and travel industries. In 2005 and 2006, Cendant broke up and spun off or sold its constituent businesses. Although the company was based in New York City
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
, the majority of Cendant's headquarters employees were located in Parsippany-Troy Hills, New Jersey.
The last CEO of Cendant was Henry Silverman.
Founding
Henry SilvermanHenry Silverman
Henry R. Silverman is an American entrepreneur and private equity investor. Silverman is best known for his role in building Cendant Corporation into a multibillion dollar business services company that provided car rentals, travel reservation services as well as real estate brokerage services and...
, a business executive and private equity
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
investor created Hospitality Franchise Systems (HFS) as a vehicle to acquire a number of hotel franchises in the early 1990s. Among Silverman’s purchases were such brands as Ramada
Ramada
Ramada is a hotel chain owned and operated by Wyndham Worldwide.- History :The lodging chain was founded in 1953 by longtime Chicago restaurateur Marion W...
and Howard Johnson's
Howard Johnson's
Howard Johnson's is a chain of hotels and restaurants, located primarily throughout the United States and Canada. Throughout the 1960s and 1970s, Howard Johnson's was the largest restaurant chain in the United States, with over 1,000 restaurants...
as well as Days Inn
Days Inn
Days Inn is a motel chain headquartered in the United States. Founded in 1970, it is now a part of the Wyndham Hotel Group, based in Parsippany, New Jersey, which was formerly a part of Cendant...
, which he was able to buy for $290 million (almost half what he had sold it for) after the company had filed for bankruptcy in 1991. Silverman quickly took Hospitality Franchise Systems public in a 1992 IPO.
HFS was among the fastest growing companies of its size in the 1990s and the company’s stock had risen from its IPO price of $4 per share to $77 per share by 1998. In 1996, Cendant purchased Sierra On-Line
Sierra Entertainment
Sierra Entertainment Inc. was an American video-game developer and publisher founded in 1979 as On-Line Systems by Ken and Roberta Williams...
and Davidson & Associates
Davidson & Associates
Davidson & Associates was an educational software company headquartered in Torrance, California. It was best known for the Blaster series, including Math Blaster and Reading Blaster...
for $2.2 billion. However in 1998, Henry Silverman
Henry Silverman
Henry R. Silverman is an American entrepreneur and private equity investor. Silverman is best known for his role in building Cendant Corporation into a multibillion dollar business services company that provided car rentals, travel reservation services as well as real estate brokerage services and...
led HFS into what would prove a disastrous merger with CUC International
CUC International
CUC International Inc. is a membership-based consumer services conglomerate with travel, shopping, auto, dining, home improvement and financial services offered to more than 60 million customers worldwide based out of Stamford, Connecticut and founded by Kirk Shelton and Walter Forbes...
, a direct marketing company that operated Shoppers Advantage and Travelers Advantage (now part of Affinion Group). The $14 billion merger of HFS and CUC resulted in the formation of Cendant Corporation, which was formed in December 1997. Also, as part of the merger, Silverman announced he would reduce his day-to-day involvement with the company and assume the company’s chairmanship in preference of CUC’s founder and CEO Walter Forbes
Walter Forbes
Walter Forbes is an American business manager and Federal prisoner.He was prosecuted by the U.S. Attorney's Office for the District of New Jersey and convicted of one count of conspiracy to commit securities fraud, and two counts of making false statements, for inflating reported incomes for the...
.
Just months after the merger, in April 1998 Cendant uncovered massive accounting improprieties at CUC which resulted in one of the largest financial scandals of the 1990s. At the time, Vice Chairman E. Kirk Shelton, had inflated the company's revenue by $500 million over a period of three years. When this report was released to the public, the resulting damage to the market value for the company was approximately $14 billion, with their stock tumbling from a high of $41 down to nearly $12. At the time, this fiasco was the largest case of accounting fraud in the country's history. Mr. Shelton is now serving a 10 year prison sentence. Former CEO Walter Forbes
Walter Forbes
Walter Forbes is an American business manager and Federal prisoner.He was prosecuted by the U.S. Attorney's Office for the District of New Jersey and convicted of one count of conspiracy to commit securities fraud, and two counts of making false statements, for inflating reported incomes for the...
was sentenced to 12 years in prison in 2007. After the accounting scandal was uncovered, Silverman and the Cendant board forced Forbes’ resignation and Silverman assumed the CEO post. Under Silverman, Cendant bounced back from the accounting scandal far outperforming the markets in the early 2000s.
Post-scandal
Following the fraud debacle, the entire interactive software branchVivendi Games
Vivendi Games, formerly known as Vivendi Universal Games, was the holdings company for Sierra Entertainment and Blizzard Entertainment. Vivendi Games was founded as Vivendi Universal Games after Vivendi bought Universal Studios in the early 2000s...
was sold for $1 billion to French publisher Havas
Havas
Havas is the second largest advertising group in France and is a "Global advertising and communications services group" and the sixth-largest global advertising and communications group worldwide, operating on the communications consulting market through three main operational divisions:*Euro RSCG...
in 1998, the same year Havas was purchased by Vivendi
Vivendi
Vivendi SA is a French international media conglomerate with activities in music, television and film, publishing, telecommunications, the Internet, and video games. It is headquartered in Paris.- History :...
.
Early in 2004, Cendant acquired the trademark rights to the Ramada brand in the United States, where there were 819 franchised properties. It also acquired the Canadian rights. On September 15, 2004, Cendant purchased the Ramada
Ramada
Ramada is a hotel chain owned and operated by Wyndham Worldwide.- History :The lodging chain was founded in 1953 by longtime Chicago restaurateur Marion W...
International Hotels & Resorts unit from Marriott International
Marriott International
Marriott International, Inc. is a worldwide operator and franchisor of a broad portfolio of hotels and related lodging facilities. Founded by J. Willard Marriott, the company is now led by son J.W. Marriott, Jr...
. At the time, this was primarily a franchised brand of 204 hotels operating in 26 countries and territories.
On September 29, 2004, Cendant purchased Orbitz
Orbitz
Orbitz Worldwide, Inc. is an Internet travel company headquartered in the Citigroup Center in Near West Side, Chicago, Illinois. Through its primary web site Orbitz.com, Orbitz Worldwide enables travelers to research, plan and book a broad range of travel products, facilitating 1.5 million flight...
for $1.2 billion.
In early 2005, Cendant purchased ebookers
Ebookers
Ebookers.com is an online travel company based out of the UK and is a wholly owned subsidiary of Travelport, the former travel arm of Cendant which was bought in October 2006 by an affiliate of Blackstone Partners. Travelport split out itself into three companies...
for just under £190 million. Later in the year, Cendant acquired London based Gullivers Travel Associates.
Breakup
On October 23, 2005, Cendant Corporation announced its decision to split into four separate companies, citing a necessity to diversify in appealing to stockholders and in an attempt to increase the value of the post-split up company. These four categories include "Real EstateRealogy
Realogy is a privately owned company that provides real estate and relocation services. It owns and franchises several of the industry's leading real estate brands and brokerages...
, Travel Distribution
Travelport
Travelport is a broad-based business services company and a leading provider of critical transaction processing solutions to companies operating in the global travel industry...
, Hospitality
Wyndham Worldwide
Wyndham Worldwide is the holding company for Wyndham Hotels & Resorts, Group RCI and other lodging brands. It was spun off from Cendant Corporation in July 2006....
and Vehicle Rental Companies
Avis Budget Group
Avis Budget Group, Inc. operates Avis Rent A Car System, LLC , Budget Rent A Car System, Inc. and Budget Truck Rental, LLC...
."
Cendant originally decided to spin off its Travel Distribution division as a separate company called Travelport
Travelport
Travelport is a broad-based business services company and a leading provider of critical transaction processing solutions to companies operating in the global travel industry...
, but on June 30, 2006, Cendant announced the sale of Travelport to an affiliate of the privately held Blackstone Group
Blackstone Group
The Blackstone Group L.P. is an American-based alternative asset management and financial services company that specializes in private equity, real estate, and credit and marketable alternative investment strategies, as well as financial advisory services, such as mergers and acquisitions ,...
for $4.3 Billion. This sale closed on August 23, 2006.
During the fall of 2005 Progeny Marketing Innovations and Trilegiant were sold to private equity group Apollo Management
Apollo Management
Apollo Global Management, LLC is a private equity investment firm, founded in 1990 by former Drexel Burnham Lambert banker Leon Black. The firm specializes in leveraged buyout transactions and purchases of distressed securities involving corporate restructuring, special situations and industry...
. They changed their name in January 2006 to Affinion Group.
On July 31 of 2006, both the Cendant Real Estate division as well as the Cendant Hospitality division were spun off and became separate companies under the names Realogy
Realogy
Realogy is a privately owned company that provides real estate and relocation services. It owns and franchises several of the industry's leading real estate brands and brokerages...
and Wyndham Worldwide
Wyndham Worldwide
Wyndham Worldwide is the holding company for Wyndham Hotels & Resorts, Group RCI and other lodging brands. It was spun off from Cendant Corporation in July 2006....
, respectively. Realogy was subsequently bought by Apollo.
The Cendant Car Rental Group, which owns Avis, Budget Rent A Car
Budget Rent a Car
Budget Rent a Car System, Inc. is an American car rental company that was founded in 1958 in Los Angeles, California by Morris Mirkin. Budget's operations are headquartered in Parsippany-Troy Hills Township, New Jersey....
and Budget Truck Rental
Budget Truck Rental
Budget Truck Rental, LLC is the second largest truck rental company in the continental United States of America with around 2,800 businesses and 32,000 trucks across the country...
rental companies, became the sole remaining company under the Cendant name. The company changed its name to Avis Budget Group
Avis Budget Group
Avis Budget Group, Inc. operates Avis Rent A Car System, LLC , Budget Rent A Car System, Inc. and Budget Truck Rental, LLC...
and the Cendant name has been completely dissolved.
Former shareholders of Cendant received as a dividend for each share of Cendant common stock held on the dividend distribution date 1/4 share of common stock of Realogy, 1/5 share of common stock of Wyndham Worldwide and the remaining shares were subject to a reverse split resulting in shareholders receiving 1 share of Avis Budget Group for each 10 shares of Cendant previously held.
Automobile rentals
Cendant owned the rental brands of Avis and BudgetBudget Rent a Car
Budget Rent a Car System, Inc. is an American car rental company that was founded in 1958 in Los Angeles, California by Morris Mirkin. Budget's operations are headquartered in Parsippany-Troy Hills Township, New Jersey....
, holding these properties in the CCRG (Cendant Car Rental Group). Avis and Budget operate a shared fleet of cars, and have the same "back end" system, but operate at different locations, offer different service levels, and have somewhat different pricing. After the Cendant name was dissolved, the car rental segment became known as Avis Budget Group
Avis Budget Group
Avis Budget Group, Inc. operates Avis Rent A Car System, LLC , Budget Rent A Car System, Inc. and Budget Truck Rental, LLC...
and currently trades on the NASDAQ
NASDAQ
The NASDAQ Stock Market, also known as the NASDAQ, is an American stock exchange. "NASDAQ" originally stood for "National Association of Securities Dealers Automated Quotations". It is the second-largest stock exchange by market capitalization in the world, after the New York Stock Exchange. As of...
stock exchange under the ticker symbol: CAR.
Hotel franchises
These brands were spun off into Wyndham WorldwideWyndham Worldwide
Wyndham Worldwide is the holding company for Wyndham Hotels & Resorts, Group RCI and other lodging brands. It was spun off from Cendant Corporation in July 2006....
.
- Hawthorn Suites by Wyndham
- Days InnDays InnDays Inn is a motel chain headquartered in the United States. Founded in 1970, it is now a part of the Wyndham Hotel Group, based in Parsippany, New Jersey, which was formerly a part of Cendant...
- Howard JohnsonHoward Johnson'sHoward Johnson's is a chain of hotels and restaurants, located primarily throughout the United States and Canada. Throughout the 1960s and 1970s, Howard Johnson's was the largest restaurant chain in the United States, with over 1,000 restaurants...
- Knights InnKnights InnKnights Inn is an economy/budget hotel chain owned by Wyndham Worldwide and based in Parsippany, New Jersey. Key features include free parking, handicapped-accessible rooms, a continental breakfast, and highway access at most locations...
- Super 8 MotelsSuper 8 MotelsSuper 8 Hotels Inc. is the world's largest budget hotel chain, with hotels in the United States and Canada, as well as newer properties in China. The company is a subsidiary of Wyndham Worldwide, formerly a part of Cendant.-History:...
- TravelodgeTravelodgeTravelodge refers to several hotel chains around the world. Current operations include: the United States, Canada, the United Kingdom, Spain, the Republic of Ireland, New Zealand and Australia...
- Wingate InnWingate InnWingate By Wyndham is a brand of independently-owned hotels that targets business travelers. Wingate opened its first hotel in July 1996. Since then, over 100 new Wingate by Wyndhams have been opened. It competes with chains like Hilton Garden Inn, Courtyard by Marriott, and Hyatt Place...
- Wyndham Hotels & ResortsWyndham Hotels & ResortsWyndham Hotels and Resorts is a group of chains of hotels and resorts located mainly in the United States and Canada, but also in Mexico and the Caribbean.-History:...
- Baymont Inn & SuitesBaymont Inn & SuitesBaymont Inn & Suites is a hotel franchise owned by Wyndham Worldwide and based in the United States.The chain began as an idea by the current CEO of Marcus Corporation, Steven Marcus to create a limited-service, discount-priced motel chain. The first property, located in Oshkosh, Wisconsin, opened...
Real estate franchises
These companies are now under the RealogyRealogy
Realogy is a privately owned company that provides real estate and relocation services. It owns and franchises several of the industry's leading real estate brands and brokerages...
banner.
- Century 21 Real EstateCentury 21 Real EstateCentury 21 Real Estate LLC is a real estate agent franchise company founded in 1971. The Century 21 System consists of over 8,000 independently owned and operated offices. Other examples of such a system are Coldwell Banker, Engel & Völkers, ERA Real Estate, ...Century 21 has offices in more than...
- Coldwell BankerColdwell BankerColdwell Banker is a large real estate franchise founded in 1906 in San Francisco.Coldwell Banker has an international presence, with offices on six continents, 46 countries and territories...
- Coldwell Banker CommercialColdwell Banker CommercialColdwell Banker Commercial or CBC is part of the oldest and most respected national real estate brand in the country.- Early years :The company was launched in 1906...
- ERA Real Estate
- Sotheby's International RealtySotheby's International RealtySotheby’s International Realty is a luxury real estate brokerage agency that offers a collection of luxury homes, estates and properties for sale throughout the world. It is owned by parent company Realogy, which was spun off in July 2006 from former parent company Cendant. Sotheby’s has real...
- Corcoran Group
- Citi-Habitats
Membership programs
- Comp-U-Card
- Shopper’s Advantage
- AutoVantage
- Traveler’s Advantage
- Buyer’s Advantage
- NetMarket
Travel services
These brands were separated into a new company called TravelportTravelport
Travelport is a broad-based business services company and a leading provider of critical transaction processing solutions to companies operating in the global travel industry...
.
- CheapTicketsCheapTicketsCheapTickets is an online travel services company focusing on the leisure market, offering airline tickets, hotel and Vacation rentals, rental cars, customized vacation packages, and cruises...
- TripRewards
- HotelClub.com
- AoYou.com
- RatesToGo.com
- Galileo CRSGalileo CRSGalileo is a computer reservations system owned by Travelport. As of 2002, it had a 26.4% of worldwide CRS airline bookings.In addition to airline reservations, the Galileo CRS is also used to book train travel, cruises, car rental, and hotel rooms...
- OrbitzOrbitzOrbitz Worldwide, Inc. is an Internet travel company headquartered in the Citigroup Center in Near West Side, Chicago, Illinois. Through its primary web site Orbitz.com, Orbitz Worldwide enables travelers to research, plan and book a broad range of travel products, facilitating 1.5 million flight...
- ebookersEbookersEbookers.com is an online travel company based out of the UK and is a wholly owned subsidiary of Travelport, the former travel arm of Cendant which was bought in October 2006 by an affiliate of Blackstone Partners. Travelport split out itself into three companies...
- Lodging.comLodging.comLodging.com, part of Cendant's Travel Distribution Services division, promoted negotiated and Galileo CRS accommodations online through own and affiliate websites. In total, their inventory consisted of over 60,000 hotels and other types of lodging....
- Asia-hotels.com
- Away.com
- travelbag.co.uk
- OctopusTravel.com
- Travelport.com
- Gta-travel.com (Gullivers Travel Associates)
- Trust International
Timeshare companies
These companies are owned by Wyndham Worldwide.- Fairfield Resorts
- Trendwest ResortsWorldMark by WyndhamWorldMark by Wyndham is a wholly owned subsidiary of Wyndham Worldwide Corporation which operates as a vacation ownership , allowing persons to purchase a real estate interest in one of the Wyndham resorts...
Vacation network groups
- RCI
- Cuendet
- Landal GreenParksLandal GreenparksLandal Greenparks is a European network of holiday villages, with locations in Belgium, the Netherlands, the Czech Republic, Austria, Germany and Switzerland.-Background:...
- French Life
- NovasolNovasolNovasol also referred to as Novasol N.V. / S.A. or Novasol Chemicals is a Belgium based Chemical Company providing a selected range of solvents, monomers, plasticizers and synthesis raw materials to customers worldwide...
See also
- Real estateReal estateIn general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
- Real estate agent
- Real estate brokerReal estate brokerA real estate broker, real estate agent or realtor is a party who acts as an intermediary between sellers and buyers of real estate/real property and attempts to find sellers who wish to sell and buyers who wish to buy...
- Real estate trendsReal estate trendsReal estate trends is a generic term used to describe any consistent pattern or change in the general direction of the real estate industry which, over the course of time, causes a statistically noticeable change...
- RealogyRealogyRealogy is a privately owned company that provides real estate and relocation services. It owns and franchises several of the industry's leading real estate brands and brokerages...
- List of Ig Nobel Prize winners#2002 Recipient of the 2002 Ig Nobel Prize in Economics "for adapting the mathematical concept of imaginary numbers for use in the business world"