(Bloomberg) – Hertz Global Holdings Inc. seeks financing from debtors more than two months after filing for Chapter 11 protection after his unusual attempt to earn money that potentially worthless shares sold by fell.
The bankrupt rental car giant said in a regulatory submission Monday it is looking for new sources of cash with the travel company in a deep battle and proceeds from the sale of their cars that creditors will pay. Hertz has just raised $ 29 million from the sale of its stake before demand by Securities and Exchange Commission officials led the company to end plans to offer as much as $ 500 million.
Hertz had tried to avoid raising funds while negotiating a debt restructuring with security holders with assets, but the decline in its core rental business and uncertainty ahead left it with a few options. The company’s revenue fell 67% in the second quarter, leading to a $ 847 million loss. The stock rose as much as 12% to $ 1.89 shortly after the opening of regular trading on Tuesday.
Europe Enlargement
With $ 1.4 billion in cash on hand, Hertz said in the submission that its continued ability to fund operations depends on a recovery in demand in key markets and an expansion of creditors’ exemptions on payments for their cars in continent Europe and the United Kingdom
Without an extension above Sept. 30th. Should Hertz start payments on its European fleet, which is owned by investors who own their securities. Hertz has already reached an agreement that allows him to use much of his U.S. fleet with a promise to pay securities holders $ 108 million a month from July to the end of the year.
To do so, Hertz plans to reduce its U.S. fleet by at least 182,000 cars after selling 100,000 cars in June and July.
In the second quarter, Hertz lost $ 587 million in revenue before interest and taxes and its $ 3.51 share loss led to a consensus estimate of $ 2.33 per share loss. Revenue fell to $ 832 million.
(Updates with amount increased from share offering in second paragraph.)
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