Famous car rental company Hertz hit lockdown, applied for bankruptcy

May 23 2020 12:59 PM
Famous car rental company Hertz hit lockdown, applied for bankruptcy

Washington: Hertz Global Holdings, a car-rental company that founded a dozen years ago with a dozen Ford Model Ts, went bankrupt late Friday, due to travel restrictions due to lock-downs and a drop in demand for its vehicles during the global economic crisis. It has filed an application for Chapter 11, in Delaware, allows Hertz to remain operational as long as it prepares a plan to pay creditors.

According to a person familiar with the matter, America's second-largest car-rental-car company, for now, does not need financing to deliver the liabilities, as the company has more than $ 1 billion in cash. Hertz's court in a filing petition listed $ 25.8 billion in assets and $ 24.4 billion in debts, and its largest creditors include IBM Corp. and Lyft Inc.

After revenue declined due to the Coronavirus epidemic, the car rental company has sought some relief from lenders and the US Treasury Department. However, the company managed to negotiate short-term repurchases from creditors, but was not able to fulfill long-term agreements.

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