(PA)

Hertz will likely come out of Chapter 11 bankruptcy protection by the end of the month after a bankruptcy court upheld the beleaguered car rental company’s plan to reorganize.

Estero-based Hertz Global Holdings Inc., which filed for bankruptcy in May 2020, said on Thursday its plan would write off more than $ 5 billion in debt and provide more than $ 2.2 billion in liquidity . Creditors will be paid in full and existing shareholders will receive over $ 1 billion in value.

Hertz was one of the first large companies to be brought down by the pandemic last year, as infections increased and halted global travel for businesses and vacationers.

He announced in March that he could sell a controlling stake in the company to two investment firms for $ 4.2 billion. Knighthead Capital Management and Certares Opportunities would have the option to buy the entire reorganized car rental company, but not less than the majority of its shares. The proposed investment, combined with new $ 1 billion senior financing, a new $ 1.5 billion revolving credit facility and a new asset-backed securitization facility to fund its fleet of vehicles in the States United, was envisioned as a way to provide the necessary financing for the company to complete its restructuring.

Hertz’s emergence of bankruptcy protection comes at a time when Americans are getting vaccinated against COVID-19 and are eager to start traveling again. The demand for rental cars is increasing and, with limited supply, prices are skyrocketing.

The Florida-based company operates the Hertz, Dollar and Thrifty car rental brands in North America, Europe, the Caribbean, Latin America, Africa, the Middle East, Asia, Australia and New Zealand .