Hertz Gets More Time to Avoid Bankruptcy
Hertz announced today that it was given more time to avoid bankruptcy and work out a rescue plan after it missed debt payments. The forbearances and waivers give Hertz until May 22 to “develop a financing strategy and structure that better reflects the economic impact of the Covid-19 global pandemic,” the company said in a regulatory filing, as per Bloomberg.
Hertz had been talking with some of its creditors about how to ease its burden without going through bankruptcy, while also preparing to file for Chapter 11 court protection if needed.
A sharp drop in travel and a global economic collapse have caused a drop of over 80% in revenue for car rental companies. Unlike airlines, Hertz has not been able to access and bailout funds that were provided in the CARES Act.
Hertz began laying off workers in March and then in April the company disclosed it had missed substantial lease payments.