Hertz is set to receive $ 1.65 billion in financing while the iconic car rental company is navigating losses during the coremavirus pandemic, which has devastated the travel industry.
Pending federal bankruptcy court approval in Delaware, Hertz’s nearly $ 2 billion lifeline will support the company as it moves into the next phase of the Chapter 11 process, according to the company.
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RENTAL CAR GIANT HERTZ FILES FOR BANKRUPTCY
“This new financing will provide additional financial flexibility as we continue to navigate the effects of the pandemic on the travel industry and take steps to position our business for the future,” the Hertz CEO said. Paul Stone in a statement on Friday.
Beginning in mid-March, the company – whose car rental brands include Dollar and Thrifty – was found to have cut its revenue streams causing global travel to a near-term halt.
By the end of March, Hertz Global Holdings Inc. has accumulated more than $ 24 billion in debt, according to filing losses, with only $ 1 billion in available cash. The company made “significant efforts” but could not raise money in the capital markets, so it started losing payments to lenders in April, the filing said.
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The company filed for bankruptcy protection in May when lenders did not want to give it another extension to auto-lease debt repayments.
The Associated Press contributed to this report.
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