Bankruptcy court OKs Hertz's reorganization plan

A bankruptcy court has confirmed Hertz’s reorganization plan, which helps clear the way for the car rental company to emerge from Chapter 11 bankruptcy protection by the end of the month

Hertz Reorganization
Hertz Reorganization

Hertz will likely emerge from Chapter 11 bankruptcy protection by the end of the month after a bankruptcy court confirmed the reorganization plan for the beleaguered car rental company.

Hertz Global Holdings Inc., which filed for bankruptcy protection in May 2020, said Thursday that its plan will eraser more than $5 billion in debt and provide more than $2.2 billion in liquidity. Creditors will be paid in full and existing shareholders will receive more than $1 billion in value.

Hertz was among the first major corporations to be felled by the pandemic last year as infections surged and shut down travel on a global scale for both companies and vacationers.

It announced in March that it might sell a controlling stake in the company to two investment firms for $4.2 billion. Knighthead Capital Management and Certares Opportunities would have the chance to buy the entire reorganized car rental company, but no less than a majority of its shares. The proposed investment, combined with a new $1 billion first-lien financing, a new $1.5 billion revolving credit facility, and a new asset-backed securitization facility to finance its U.S. vehicle fleet, was eyed as a way to provide the funding needed for the company to complete its restructuring.

Hertz's emergency from bankruptcy protection comes at a time when Americans are getting vaccinated for COVID-19 and eager to start traveling again. Demand for car rentals is surging, and with limited supply, prices are skyrocketing.

The Florida company runs the Hertz, Dollar and Thrifty vehicle rental brands throughout North America Europe, the Caribbean, Latin America Africa, the Middle East, Asia, Australia and New Zealand.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Please enter a valid email
Please enter a valid email
Must be at least 6 characters, include an upper and lower case character and a number
Must be at least 6 characters, include an upper and lower case character and a number
Must be at least 6 characters, include an upper and lower case character and a number
Please enter your first name
Special characters aren’t allowed
Please enter a name between 1 and 40 characters
Please enter your last name
Special characters aren’t allowed
Please enter a name between 1 and 40 characters
You must be over 18 years old to register
You must be over 18 years old to register
Opt-out-policy
You can opt-out at any time by signing in to your account to manage your preferences. Each email has a link to unsubscribe.

By clicking ‘Create my account’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in