Hertz set to ride out of bankruptcy with $4.2 billion from investment firms

[March 02, 2021]  (Reuters) - Two investment firms will buy a majority stake in Hertz Global Holdings Inc for $4.2 billion under a restructuring plan expected to help it out of bankruptcy by early- to mid-summer, the car rental company said in a filing on Tuesday.

 The desk of car rental company Hertz is seen at Nice International airport during the coronavirus disease (COVID-19) outbreak in Nice, France, May 27, 2020. REUTERS/Eric Gaillard

Under the proposed investment, Knighthead Capital Management LLC and Certares Opportunities LLC will buy up to 100% of Hertz's shares, with the funds expected to finance its U.S. vehicle fleet and slash corporate debt.

"We've been...repositioning our business as we prepare for increased travel demand as the pandemic subsides," Chief Executive Paul Stone said.

Hertz filed for bankruptcy protection in May after its business was decimated by the COVID-19 pandemic and talks with creditors failed to result in much-needed relief.

The company said on Tuesday it filed a proposed plan of reorganization with the U.S. bankruptcy court for the district of Delaware, which is expected to approve the terms of the proposed investment at a hearing on April 16.

(Reporting by Sanjana Shivdas in Bengaluru; Editing by Shailesh Kuber and Devika Syamnath)

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