United Rentals' (URI) National Pump Deal is Credit Positive, Citi Says

Citgroup's credit analysts reiterate an Overweight on United Rentals (NYSE: URI) with Buy ratings on URI 6.125% senior notes following the acquisition of National Pump, the second largest specialty pump rental company in North America, for $780 million, saying the deal is supportive of the long-term credit story.

Credit analyst Manish Somaiya said, "We view the specialty rental acquisition as highly accretive owing to solid EBITDA margin profile and attractive end-market exposure. Separately, this transaction would likely imply that URI is no longer in the running for Hertz's (NYSE: HTZ) equipment rental business in the near-term. Recall, we view a spin-off as the most likely scenario at HTZ."

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