Rental car giant Hertz is emerging from bankruptcy protection. Two investment firms have agreed to purchase a majority stake in Hertz for $4.2 billion. It’s part of a new restructuring plan that will lead the rental car company out of bankruptcy by this summer, according to the companies involved in the transaction. Under the proposed deal, Knighthead Capital Management LLC and Certares Opportunities LLC will buy up to 100% of Hertz’s shares. The funds are expected to finance its U.S. vehicle fleet and slash corporate debt.
Hertz filed for bankruptcy protection in May of last year after its business was decimated by the COVID-19 pandemic. They also had to sell off a large chunk of their rental fleet, leading to some great consumer deals. Unfortunately, talks with their creditors failed to result in financial relief.
Based in Estero, Florida, Hertz operates 10,200 corporate and franchisee locations around the world. Founded in Chicago in 1918, Hertz is credited with starting the rental car industry.
Prior to its 2020 bankruptcy, Hertz was the second largest rental car company in the U.S. by both sales and fleet size. Hertz stock is currently trading at $1.19 a share after being delisted from the New York Stock Exchange. The shares now trade on the over-the-counter market.