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The proposed deal, which is subject to approval by the U.S. bankruptcy court for the district of Delaware, is supported by holders of over 85% of the company’s unsecured notes, Hertz said in a statement.
Under the deal, the supporting noteholders have given the green signal to support the exchange of the unsecured funded debt claims against the company for approximately 48.2% of the equity in the reorganized company, and the right to purchase an additional $1.6 billion of equity.
They have also committed to purchase, or otherwise backstop, the full $1.6 billion of equity being offered to the holders of the company’s unsecured funded debt.
“This plan accomplishes all the goals we set out to achieve through our financial restructuring. Our new sponsors combined with our strong leadership team will bring significant operational experience across fleet financing and management, which will benefit all of our stakeholders,” Chief Executive Paul Stone said.
Hertz filed for bankruptcy protection in May as travel plummeted during the pandemic, slamming the car rental business, and talks with creditors failed to result in much-needed relief.
On March 2, Hertz said two investment firms — Knighthead Capital Management LLC and Certares Opportunities LLC — will buy a majority stake in the company for $4.2 billion under a restructuring plan expected to help it out of bankruptcy by early- to mid-summer.
