Hertz gets US$1.65b bankruptcy financing package

[NEW YORK] Hertz Global Holdings has arranged a new US$1.65 billion debt package to help fund its bankruptcy case, the car rental giant said Friday.

Certain of the company's first-lien lenders will provide the financing, which will be structured as a delayed-draw term loan, Hertz said in a statement. As much as US$1 billion of the debt can be used for vehicle acquisition in the US and Canada, while US$800 million can be used for working capital and general corporate purposes.

The deal follows Hertz's earlier, controversial attempt to sell new, potentially worthless shares to fund its bankruptcy. The stock rose 40 per cent premarket on news of the new debt deal.

Bloomberg earlier reported the car rental company was negotiating with creditors on a potential bankruptcy loan package. The new financing needs approval from its bankruptcy judge, and a hearing is set for Oct 29.

BLOOMBERG