A group of private investment funds including Washington's Carlyle Group is in advanced negotiations to buy car rental company Hertz Corp. from Ford Motor Co. for as much as $6 billion, according to sources familiar with the matter.

Carlyle is joining New York corporate buyout firm Clayton, Dubilier & Rice and Merrill Lynch Global Private Equity in the deal. The sources, who spoke on the condition they not be identified because no deal is complete, said the Carlyle-Clayton-Merrill Lynch consortium this week bested a competing offer from another group of private equity investors.

Ford, which owns all of Hertz's stock, registered to spin off the company in a public stock offering in June as part of the car company's efforts to raise cash and pare down its debt. But corporate buyout firms immediately stepped in with offers to buy Hertz outright from Ford. Leveraged buyout firms are attracted to the car rental business because it has robust cash flow and hard assets that can be borrowed against.

The sources said Ford's board has yet to vote on the offer and could still decide on a public offering of Hertz. In addition, a competing group that includes New York buyout firms Blackstone Group and Thomas H. Lee Partners could make a higher offer.

A spokesman for Ford declined to comment.

Each of the three firms in the Carlyle consortium would put up about $1 billion to finance the purchase. Including the assumption of about $10 billion in Hertz's existing debt, the consortium would have to borrow as much as $13 billion to make the deal. The new debt, technically, would be an obligation of Hertz, which is based in New Jersey and is the largest U.S. car rental company, with $6.7 billion in revenue last year. Hertz earned $365.5 million in 2004, more than double its 2003 profit.

The Carlyle-Clayton-Merrill Lynch offer was reported in yesterday's Wall Street Journal.

A purchase of Hertz would be Carlyle's biggest deal since the firm raised a $7.8 billion fund earlier this year, Carlyle Partners IV. But a deal of that size would likely cause Carlyle to bring in co-investors so that Carlyle IV doesn't put too much of the fund in one investment.

This year is turning out to be one of the most active for leveraged buyouts since the 1980s, when a torrid junk-bond market fueled numerous multibillion-dollar buyouts financed almost entirely with debt. The $25 billion purchase of RJR Nabisco by Kohlberg, Kravis, Roberts in 1988 still ranks as the largest-ever leveraged buyout.

While the use of leverage -- or borrowing as a percentage of the deal's total size -- is lower than it was in the 1980s, pension funds, endowments and wealthy investors have poured money into leveraged buyout funds in recent years. The flow of money has produced several funds of $5 billion or more managed by Carlyle, Blackstone, Warburg Pincus and others. Such funds typically contribute between 5 and 20 percent of their own cash to a deal, borrowing the rest.

Also, buyout funds are teaming together to take on ever larger deals. Last month, a consortium completed an $11.4 billion buyout of Pennsylvania software company SunGard Data Systems Inc., the second-largest buyout after the RJR Nabisco deal. So far this year, according to Bloomberg News, there have been $188 billion worth of disclosed leveraged buyouts, on pace to reach 50 percent more than in 2004.

Separately, Carlyle cleared a major hurdle in its $400 million offer to buy a 24.9 percent stake in China Pacific Life Insurance Co., one of mainland China's largest insurers, when the insurer's parent company approved the deal on Monday. The board approval was reported yesterday in the Wall Street Journal.

Hertz, owned by Ford Motor Co., is the nation's No. 1 car rental company. At least two groups are bidding for it.