NEW YORK: Hertz Global Holdings has chosen an enhanced proposal from Centerbridge Partners, Warburg Pincus and Dundon Capital Partners to provide equity capital to fund Hertz’s exit from chapter 11.
The deal, which is subject to bankruptcy court approval, is supported by holders of more than 85% of the company’s unsecured notes.
The level of support gave the proposal a “clear advantage” over a competing offer, with Hertz saying that either would leave it in “a significantly strengthened financial position.”
It earlier received a rival proposal from Knighthead Capital Management and Certares Management.
“The proposal maximises the company’s opportunity to capitalise on the current market conditions for the financing of its business going forward and to exit chapter 11 in a timely and efficient fashion, ” Hertz said, adding that it remains on track to conclude its bankruptcy in June.
The supporting noteholders have agreed to support the exchange of the unsecured funded debt claims against Hertz for about 48.2% of the equity in the reorganised company and the right to purchase an additional US$1.6bil (RM6.6bil) of equity.
They have also committed to purchase, or otherwise backstop, the full $1.6 billion of equity being offered to the holders of Hertz’s unsecured funded debt. — Bloomberg