Vehicle rental firm Hertz Global Holdings Inc HTZ.N is preparing to file for bankruptcy as soon as Friday night after failing to reach a standstill agreement with its top lenders, the Wall Street Journal reported https://on.wsj.com/2A4ONKs, citing people familiar with the matter.
All revenue was lost in March when worldwide travel came to a halt in order to stop the spread of the coronavirus, and with debt payments building up since April, the filing of bankruptcy protection was the company's only option.
Rental auto giant Hertz is preparing to file for bankruptcy as soon as this weekend after failing to reach a "standstill agreement" with top lenders, according to a report in the Wall Street Journal. The company said the moves would save $2.5 billion per year.More news: Warehouse fire erupts at San Francisco’s Pier 45
Hertz has a fleet of about 4 lakh cars, and it may need to liquidate some of its fleet to repay the bonds.
Court documents have revealed Hertz, which has more than 400 outlets across the United Kingdom and Ireland, including three in Norwich, was 18.7 billion USA dollars (£15.3bn) in debt at the end of March with only 1 billion dollars (£820m) of available cash.
U.S. airlines have so far avoided similar fates after receiving billions of dollars in government aid, an avenue Hertz has tried unsuccessfully.More news: The Locked Vaults in Call Of Duty Warzone are Opening
Hertz has until Friday to make about $400 million in lease payments for its fleet of vehicles or extend a forbearance agreement with its creditors, the news outlet reported.
Hertz Global Holdings Inc. has been at loggerheads with a key group of creditors with time running out to cut a deal that addresses missed debt payments, according to people with knowledge of the matter. He previously served as executive vice president and chief retail operations officer for North America.
After many states began to declare stay at home orders in March, vehicle rentals dried up, and Hertz reduced spending, implemented furloughs and laid off 20,000 employees.More news: You Can Now Get Wheelchair Accessibility Information Prominently on Google Maps
Hertz traces its roots to 1918 when Walter Jacobs, then a pioneer of renting cars, founded a company allowing customers to temporarily drive one of a dozen Ford Model Ts, according to the company's website.