EXHIBIT 99.2
Cendant Corporation Creates Netmarket Group, Inc. as Independent Company
Netmarket to Pursue Rapid Growth of Interactive Membership Businesses
Cendant Will Fund Netmarket with $77 Million Development Advance
Cendant to Record $0.06 Third Quarter Charge
New York, NY, September 15, 1999 -- Cendant Corporation (NYSE: CD) today
announced it has created Netmarket Group, Inc. (NGI) as an independent company
that will pursue the development of interactive businesses currently within the
Company's Direct Marketing Division. NGI will own, operate, develop and expand
what were formerly Cendant's principal on-line membership businesses, including
Netmarket.com, Travelers Advantage, AutoVantage and Privacy Guard. Additionally,
NGI will own and operate Hagglezone.com, the first site of its kind where
consumers "haggle" with computer-generated on-line characters to get low prices
on name-brand products. NGI's businesses currently have 1.3 million online
members and are expected to produce approximately $70 million in revenue in
1999.
Cendant's Chairman, President and CEO, Henry R. Silverman, said: "The
creation of Netmarket Group as an independent company will allow NGI to
aggressively create value as an Internet company, unimpeded by having to
consider the financial impact of its tactical and strategic decisions on
Cendant. Netmarket will also now have its own equity to incent its managers and
to pursue strategic opportunities.
"These are essential elements to creating value on-line," Silverman
continued. "We expect NGI's management to accelerate growth and create real
value which can be recognized through an IPO or other mechanism as the business
develops."
Cendant will retain the opportunity to participate in NGI's value through
ownership of a convertible preferred stock, ultimately exchangeable into 78% of
NGI's fully diluted common shares. NGI's management will hold the next largest
stake through NGI stock options. Cendant will donate NGI's outstanding common
stock to a charitable trust. In addition, NGI will issue common stock to certain
of its marketing partners. Accordingly, as a result of the change of ownership
of NGI's common stock from Cendant to independent parties, NGI's results will no
longer be included in Cendant=s financial statements.
"Netmarket Group will operate as a vital resource to Cendant's classic
off-line membership business," said Michael P. Monaco, vice chairman of Cendant
and CEO, Direct Marketing Division. "NGI will pursue a variety of strategic
opportunities, some independently, some together with Cendant's Individual
Membership Division. The Internet is a critical area of future growth for the
membership division. With NGI as a strategic partner, our opportunities to
better serve customers are dramatically expanded, to the mutual benefit of both
businesses."
In conjunction with the creation of NGI, Cendant estimates it will record a
pre-tax charge of $85 million and an after-tax charge of $48 million or $0.06
cents per-share in the third quarter of 1999.
Visit Netmarket Group=s businesses on the Web and America Online:
http://www.netmarket.com, AOL Keyword: netmarket
http://www.travelersadvantage.com, AOL Keyword: travelersadvantage
http://www.autovantage.com, AOL Keyword: autovantage
http://www.privacyguard.com, AOL Keyword: creditalert
http://www.hagglezone.com, AOL Keyword: hagglezone
http://www.fareagent.com
Statements about future results made in this release may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements are based on current
expectations and the current economic environment. The Company cautions that
these statements are not guarantees of future performance. They involve a number
of risks and uncertainties that are difficult to predict. Actual results could
differ materially from those expressed or implied in the forward-looking
statements. Important assumptions and other important factors that could cause
actual results to differ materially from those in the forward-looking statements
are specified in the Company=s Form 10-K/A for the year ended December 31, 1998,
including the resolution of the pending class action litigation and the
Company's ability to implement its plan to divest non-strategic assets.
Cendant Corporation is a global provider of consumer and business services.
The Company=s core competencies include building franchise systems, providing
outsourcing solutions and direct marketing. As a franchisor, Cendant is among
the world=s leading franchisors of hotels, rental car agencies, tax preparation
services and real estate brokerage offices. The real estate division also
includes Welcome Wagon/GETKO and the Company's residential real estate services
Internet portal which is currently under development. As a provider of
outsourcing solutions, Cendant is the world's largest vacation exchange service,
a major provider of mortgage services to consumers and the global leader in
employee relocation. In direct marketing, Cendant provides access to insurance,
travel, shopping, auto, and other services primarily to customers of its
affinity partners. Other business units include NCP, the UK's largest private
car park operator, and Wizcom, an information technology services provider.
Headquartered in New York, NY, the Company has more than 30,000 employees and
operates in over 100 countries.
More information about Cendant, its companies, brands and current SEC
filings may be obtained by visiting the Company's Web site at www.Cendant.com or
by calling 877-4INFO-CD (877-446-3623).
Media Contact: Investor Contacts:
Elliot Bloom Denise Gillen
212-413-1832 212-413-1833
Sam Levenson
212-413-1834