Hertz CEO Mark Frissora is stepping down, citing personal reasons


Hertz Global Holdings on Monday announced Chairman and CEO Mark Frissora is stepping down, citing personal reasons as pressure from investors mounts following a series of accounting errors.

Hertz's shares rose as much as 5 percent after the No. 2 U.S. car rental company said it had begun the search for a replacement. Several investors and analysts named Scott Thompson, former CEO of Dollar Thrifty, as a possible candidate.

Brian MacDonald, CEO of Hertz's equipment rental business, which will soon be spun off, was named interim chief executive.

Mark Frissora, CEO and chairman of Hertz
Adam Jeffery | CNBC

Hertz has owned up to a string of accounting errors, originating in 2011, that will require it to restate or correct its financial results for the past three years. The company last month withdrew its full-year financial forecast.

Disclosing an 8.5 percent stake in Hertz last month, activist investor Carl Icahn said he planned to quiz management over accounting issues.

Private investment firm Fir Tree Partners, which owned 3 percent of Hertz's stock at the end of the second quarter, has said Frissora had "completely lost credibility."

Read MoreHertz to restate 3 years of results

"I'm sure he got the message that people don't want him," a different Hertz shareholder told Reuters. The investor declined to be identified, citing company policy.

Frissora, 58, also stepped down as chairman. He was not available for comment.

Frissora is credited for the shrewd acquisitions that helped Hertz to grow into a $12.7 billion company - more than two-and-a-half times its value when it listed in 2006, shortly after Frissora took the helm.

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"During Mark's tenure, Hertz has transformed from a single on-airport car rental brand to a world leading rental car company," said Linda Levinson, who was announced as independent non-executive chairwoman on Monday.

Frissora presided over Hertz's buyout of Dollar Thrifty after a tussle with Avis Budget Group. He also ranked fifth on Business Travel News' list of the 25 most influential executives of 2012.

But some analysts and investors have said Hertz had not been able to raise prices as much as it should have after swallowing up a major competitor. Some are calling for the man who led Dollar Thrifty at the time as a replacement for Frissora.

Read MoreIcahn reveals Hertz stake, plans to push management

"There has been a clamoring for Scott Thompson, who did a fabulous job in taking Dollar Thrifty from close to bankruptcy to an $87.50 per share buyout," said Michael Millman, managing member of independent securities research company Millman Research Associates. Hertz had first offered $2 per share.

To Friday's close, Hertz's stock had fallen 0.6 percent this year compared with a 64 percent jump in the value of Avis, the third-largest U.S. car rental company. Privately held Enterprise Rent-A-Car is the largest player in the $24 billion market.

Hertz's shares were up more than 1 percent in afternoon trading on the New York Stock Exchange on Monday.

By Reuters