Breaking News —
New York, May 22 . .- The car rental company Hertz is preparing to declare bankruptcy after failing to reach an agreement with its main creditors, which gave it until Friday, several US media reported, citing sources close to the question.
According to The Wall Street Journal (WSJ), the company could file for bankruptcy tonight.
The company has been forced to resort to this extreme due to the problems it had been experiencing and which intensified during the pandemic after restrictions on air and land traffic, “which have decimated the vehicle rental market.”
“Bankruptcy would make Hertz one of the most high-profile corporations” in the United States to be unable to pay its creditors due to the impact of the new coronavirus pandemic, according to the newspaper.
The lenders requested compensation from the company in exchange for a new extension of the terms, but the parties did not reach an agreement, the WSJ said.
Hertz has approximately $ 19 billion in debt, comprised of $ 4.3 billion in corporate bonds and loans and $ 14.4 billion in vehicle-backed debt.
On May 12, the specialized channel CNBC assured that concerns about Hertz’s ability to meet the payment of its obligations had increased, especially after it announced that its creditors would give it until Friday to launch a plan to refinance the debt and avoid filing for bankruptcy.
The company, based in The Estero, in the state of Florida, and whose main shareholder is the company Carl Icahn, which owns 38.94% of the shares, announced on March 11 that it was in contact with its shareholders and directors to develop a financing strategy.
The WSJ and New York Times note that Hertz has spent years trying to restructure its business and competing with similar companies like Enterprise Holdingd or Avis, as well as chauffeured car rental companies like Uber or Lyft.