Hertz Global Holdings, Inc. announced April 3 it has selected an enhanced proposal from Centerbridge Partners, L.P., Warburg Pincus LLC and Dundon Capital Partners, LLC to provide the equity capital required to fund Hertz's exit from Chapter 11, keeping the company on track to conclude its Chapter 11 case in June.
The deal is reflected in definitive executed documents, including an equity purchase and commitment agreement, a plan support agreement, a bridge financing commitment for Hertz International Ltd., an amended Chapter 11 plan of reorganization and an amended disclosure statement, which have been filed with the Delaware bankruptcy court presiding over Hertz's Chapter 11 case.
The proposed transaction, which remains subject to approval by the bankruptcy court, is supported by holders of more than 85% of the company's unsecured notes, which comprise the vast majority of creditors in the largest class of claims voting on the plan.
As disclosed earlier that week, the two leading proposals under consideration had been advanced to the point where either one would leave the company in a significantly strengthened financial position.
Both would provide bridge financing to fund the company's European fleet needs prior to the plan's consummation. At exit, under both proposals, the company would eliminate approximately $5 billion of debt, have more than $2 billion of global liquidity and completely eliminate all corporate debt on its European business.
The level of creditor support for the sponsorship group's proposal gave it the clear advantage. The proposal maximizes the company's opportunity to capitalize on the current market conditions for the financing of its business going forward and to exit Chapter 11 in a timely and efficient fashion.
"We are pleased to be moving forward with an enhanced proposal supported by our largest creditor constituency and that delivers excellent value to all our stakeholders," said Paul Stone, president and CEO. "This plan accomplishes all the goals we set out to achieve through our financial restructuring.
"Our new sponsors combined with our strong leadership team will bring significant operational experience across fleet financing and management, which will...