Organization, Description Of Business And Consolidation

3 Months Ended

Mar. 31, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization, Description of Business and Basis of Presentation

Organization, Description of Business and Basis of Presentation

United Rentals, Inc. (“Holdings,” “URI” or the “Company”) is principally a holding company and conducts its operations primarily through its wholly owned subsidiary, United Rentals (North America), Inc. (“URNA”), and subsidiaries of URNA. Holdings’ primary asset is its sole ownership of all issued and outstanding shares of common stock of URNA. URNA’s various credit agreements and debt instruments place restrictions on its ability to transfer funds to its shareholder.

We rent equipment to a diverse customer base that includes construction and industrial companies, manufacturers, utilities, municipalities, homeowners and government entities in the United States and Canada. In addition to renting equipment, we sell new and used rental equipment, as well as related contractor supplies, parts and service.

On December 15, 2011, we entered into a definitive merger agreement with RSC Holdings, Inc. (“RSC”), pursuant to which we agreed to acquire RSC on the terms and conditions set forth in the merger agreement in a cash-and-stock transaction that ascribed a total enterprise value of $4.2 billion to RSC. In connection with the proposed transaction, RSC stockholders will receive approximately $2.4 billion in total merger consideration, comprised of approximately $1.2 billion of cash consideration, shares of our common stock valued at approximately $1.2 billion (based on the average of the high and low sales prices of our common stock on April 12, 2012) and RSC stock options and restricted stock units valued at approximately $69. The cash portion of the merger consideration and transaction fees and expenses are expected to be financed with the net proceeds from URI Financing Escrow Corporation's (the “Funding SPV”) $750 aggregate principal amount of 5 ³/₄ percent senior secured notes due 2018, $750 aggregate principal amount of 7 ³/₈ percent senior notes due 2020 and $1,325 aggregate principal amount of 7 ⁵/₈ percent senior notes due 2022 (together, the “merger financing notes”) and cash on hand and/or borrowings under our senior secured asset-based revolving credit facility (“ABL facility”). The Funding SPV is our wholly owned subsidiary. The proceeds from the merger financing notes were deposited into segregated escrow accounts and will be released from escrow subject to the satisfaction of certain conditions, including the occurrence of the merger substantially in accordance with the terms and conditions of the merger agreement and the assumption by a newly formed wholly owned subsidiary of URI, into which URNA will be merged in connection with the RSC merger, of all of the obligations of Funding SPV under the indentures governing the notes and related documentation.

After paying the cash portion of the merger consideration, we will use the net proceeds from the sale of the merger financing notes to repay RSC's senior secured asset based loan revolving facility, which had approximately $548 outstanding as of March 31, 2012, satisfy and discharge $400 principal amount of RSC's 10 percent senior secured notes due 2017, satisfy and discharge $503 principal amount of RSC's 9.50 percent senior notes due 2014 and pay related transaction fees and expenses. In connection with the proposed transaction, we will assume all of RSC's remaining debt, the principal amount of which totaled $947 as of March 31, 2012.

The waiting periods applicable to the proposed transaction under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and section 114 of Part IX of the Competition Act (Canada) expired or terminated on January 20, 2012 and February 14, 2012, respectively. Nevertheless, the proposed transaction remains subject to approval by our stockholders and RSC's stockholders and certain other closing conditions, including the delivery of a solvency opinion. The registration statement on Form S-4 and the joint proxy statement/prospectus forming a part thereof relating to the proposed transaction were declared effective by the Securities and Exchange Commission on March 23, 2012, and mailed to our stockholders and RSC's stockholders on or about March 26, 2012. Holdings and RSC will each hold special meetings on April 27, 2012 at which their respective stockholders will vote on whether to approve the merger and related matters. Subject to receipt of these stockholder approvals and satisfaction of certain other closing conditions, we anticipate that the proposed transaction will close on April 30, 2012.

We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with the accounting policies described in our annual report on Form 10-K for the year ended December 31, 2011 (the “2011 Form 10-K”) and the interim reporting requirements of Form 10-Q. Accordingly, certain information and note disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the 2011 Form 10-K.

In our opinion, all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair presentation of financial condition, operating results and cash flows for the interim periods presented have been made. Interim results of operations are not necessarily indicative of the results of the full year.