Global car hire group, Hertz, is set to emerge from bankruptcy at the end of this month. The group’s reorganisation plan will eliminate over €4 billion of debt, including all of Hertz Europe’s corporate debt, and will provide more than €1.8 billion of global liquidity to the reorganised company.
AS a result of its restructuring efforts, Hertz will emerge from Chapter 11 with a substantially stronger balance sheet and greater financial flexibility than it had prior to the onset of the Covid-19 pandemic, which forced Hertz to file for Chapter 11 relief in May 2020.
Hertz’s reorganisation plan will eliminate over €4 billion of debt, including all of Hertz Europe’s corporate debt, and will provide more than €1.8 billion of global liquidity to the reorganised company. Hertz also will emerge with a new €2.3 billion exit credit facility consisting of at least €1.07 billion of term loans and a revolving loan facility; and approximately €5.74 billion of asset-backed vehicle financing facility, each on favourable terms. The Plan provides for the payment in cash in full to all creditors and for existing shareholders to receive more than €820 million of value.
Paul Stone, Hertz’s President and Chief Executive Officer, said, “With the Court’s approval of our Plan today and a committed new investor group, we are poised to exit Chapter 11 by the end of this month as a well-capitalised and even more competitive company, with the flexibility and resources to pursue exciting new growth opportunities.
“I want to thank our employees and teams around the world for their hard work, which has enabled us to continue taking great care of our customers. As the demand for rental cars continues to rise, we look forward to helping our customers travel confidently and safely as they get back out on the road, and to successfully building on Hertz’s more than 100-year history of quality service as one of the world’s best-known brands,” he added.