Hertz jumps 177% after it lines up $1.65 billion in potential financing

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  • Hertz soared 177% on Friday after it lined up potential debtor-in-possession financing of $1.65 billion, according to a regulatory filing.
  • Hertz entered a commitment letter for the $1.65 billion deal, which is not official until it is approved by the bankruptcy court.
  • The court will hold a hearing to review the potential financing on or around October 29. 
  • Up to $1 billion of the financing could be used for new interim fleet financing.
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Hertz soared on Friday after it said in a regulatory filing that it entered a letter of commitment for a potential debtor-in-possession financing deal of up to $1.65 billion.

Shares of the rental-car company were up as much as 177% in Friday trades to $2.86.

The financing deal is subject to the approval of bankruptcy court, which is expected to hear the matter on or around October 29. 

Hertz made waves with investors over the summer after it was bid up more than 1,000% despite being in the throes of bankruptcy proceedings.

If the financing deal is approved, up to $1 billion of the proceeds could be used for new interim fleet financing. 

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The potential financing is with holders of a majority in aggregate outstanding amount of its prepetition first-lien debt, according to the regulatory filing. 

 The DIP Facility matures on December 31, 2021, and has limited covenants and events of default, including one milestone requiring the filing of a plan by August 1.

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