Hertz Secures $221M in New Asset-Backed Notes at High Rates, Extends European & US Fleet Financing

summarizeSummary

Hertz issued $221.4 million in new asset-backed notes with high interest rates and extended significant U.S. and European fleet financing facilities, securing crucial capital for operations despite increased financing costs.

check_boxKey Events

• New Asset-Backed Notes Issued

  Hertz Vehicle Financing III LLC, a subsidiary, issued $221,421,000 in new Class E Fixed Rate Rental Car Asset Backed Notes. These notes are subordinated to existing Class A, B, C, and D notes.

• High Interest Rates on New Notes

  The newly issued Class E notes carry fixed interest rates ranging from 10.67% to 12.54%, indicating a high cost of capital for this financing.

• U.S. Fleet Financing Extended

  The commitment termination date for the Series 2021-A Variable Funding Rental Car Asset Backed Notes, Class A, was extended by one year to May 5, 2028, maintaining a maximum principal amount of $3.24 billion (reducing to $2.98 billion after May 7, 2027).

• European Fleet Financing Increased

  Amendments to the European securitization platform extended the maturity of Class A, B, and C Notes to April 2028 and increased the aggregate commitment size to €1,293,062,500 for vehicle fleets in several European countries.

auto_awesomeAnalysis

Hertz Global Holdings, Inc. has secured significant financing for its vehicle fleets, issuing $221.4 million in new Class E Fixed Rate Rental Car Asset Backed Notes. These notes carry high interest rates ranging from 10.67% to 12.54% and are subordinated to existing Class A, B, C, and D notes. Additionally, the company extended the commitment termination date for its Series 2021-A Variable Funding Notes in the U.S. to May 5, 2028, maintaining a substantial funding capacity of up to $3.24 billion. Concurrently, Hertz amended its European securitization platform, extending the maturity of certain notes to April 2028 and increasing the commitment size to €1.29 billion. While securing this capital is crucial for operational stability and fleet management, the high interest rates on the new Class E notes indicate a higher cost of capital, which could impact profitability.