With court approval, Hertz set to exit bankruptcy

ESTERO, Fla. – 

Hertz Global Holdings reached a significant achievement on Thursday, as the company rebounds from pandemic challenges.

Hertz announced that a federal bankruptcy court confirmed the company’s plan of reorganization. According to a news release, the plan unimpairs all classes of creditors — who are legally deemed to have accepted it — and was approved by more than 97% of voting shareholders.

Hertz said the court’s approval clears the way for the company to emerge from Chapter 11 by the end of the month.

As a result of its restructuring efforts, Hertz said it 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 last May.

Hertz explained its plan will eliminate over $5 billion of debt, including all of Hertz Europe’s corporate debt, and will provide more than $2.2 billion of global liquidity to the reorganized company.

Hertz also noted that it will emerge with:

— A new $2.8 billion exit credit facility consisting of at least $1.3 billion of term loans and a revolving loan facility

— Approximately $7 billion of asset-backed vehicle financing facility

The company mentioned each facility contains “favorable” terms.

Hertz went on to mention its plan provides for the payment in cash in full to all creditors and for existing shareholders to receive more than $1 billion of value.

“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-capitalized and even more competitive company, with the flexibility and resources to pursue exciting new growth opportunities,” Hertz president and chief executive officer Paul Stone said in the news release.

“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,” Stone continued. “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.”

White & Case LLP is serving as legal advisor. Moelis & Co. is serving as investment banker, and FTI Consulting is serving as financial advisor.

To obtain court documents or filings, visit https://restructuring.primeclerk.com/hertz or call (877) 428-4661 or (929) 955-3421.

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