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AutoNation Announces Tax-Free Spin Off Of Automotive Rental Business

Sep. 30, 1999

AutoNation Shareholders to Receive Distribution of Stock

FORT LAUDERDALE, Fla., Sept. 30 /PRNewswire/ -- AutoNation, Inc. (NYSE: AN) announced today that it will separate its automotive rental business from its automotive retail business in the form of a tax-free dividend of shares of the new automotive rental company to the shareholders of AutoNation. The company said it has received a favorable ruling from the Internal Revenue Service regarding the distribution of the stock. The separation is subject to the Company's satisfaction of certain conditions, including bank approvals and compliance with regulatory requirements.

AutoNation anticipates that the distribution of the stock will occur during the second half of January, 2000. The Company also said that it expects to set a record date that will occur in late December, 1999, and that the distribution will be at a ratio of one share of the new automotive rental company for every six to eight shares of AutoNation owned. AutoNation emphasized that the actual record date, distribution date and ratio have not yet been finalized.

Following the separation, AutoNation, Inc. will be focused solely on the automotive retail business. AutoNation's automotive rental business, which includes Alamo, National and CarTemps USA, will be a free-standing public company, which in 1998 had revenue of about $3.5 billion.

Commenting on the proposed distribution, AutoNation Chairman H. Wayne Huizenga said, "We are very pleased to be rewarding AutoNation shareholders with stock in what will be one of the largest publicly traded automotive rental companies in the world. AutoNation's Board of Directors examined all the alternatives for the separation and determined that a tax-free distribution of shares in the rental company offers AutoNation and its shareholders the greatest long-term value."

Based in Fort Lauderdale, Florida, AutoNation, Inc. is America's largest automotive retailer, with 412 franchises and/or 42 AutoNation USA used vehicle megastores in 24 states. On August 2, 1999, the Company announced its plan to separate its automotive rental businesses from its automotive retail business and to focus its efforts on building the AutoNation automotive retail business.

Certain statement and information incurred in this release constitute "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performances, or achievements expressed or implied in such forward-looking statements. Additional discussion of factors that could cause actual results to differ materially from management's projections, forecasts, estimates and expectations is contained in the Company's SEC filings.

SOURCE AutoNation, Inc.
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