Hertz Reportedly Hires Another Adviser for Bankruptcy Preparations

Hertz, which missed a lease payment last week, reportedly hires an additional adviser to help prepare for a possible bankruptcy filing.
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Hertz Global  (HTZ) - Get Report shares fell sharply Tuesday after The Wall Street Journal reported the car-rental company hired an additional adviser to help prepare for a possible bankruptcy filing.

Hertz, which missed a lease payment last week, hired FTI Consulting to advise it on efforts to streamline operations in advance of a possible chapter 11 filing, the Journal reported, citing people familiar with the matter.

The missed lease payment set off a grace period that expires Monday, the Journal noted. Hertz has been working to secure agreements from lenders to hold off on taking action against the company and to continue negotiations.

Hertz has been working to renegotiate its debt of $17 billion. 

The company said in a regulatory filing last week that as a result of the pandemic Hertz and its subsidiaries have "experienced a rapid, sudden and dramatic negative impact on their businesses" and "faces significant ongoing operating expense."

Earlier this month Hertz said it would lay off 10,000 employees in North America as it looks to cut costs amid the downturn in business during the coronavirus outbreak.

Hertz rival Avis Budget Group  (CAR) - Get Report also has been hurt by fewer travel customers during the coronavirus pandemic. 

Avis on Monday reported a first-quarter loss of $158 million on a revenue decline of 9% to $1.8 billion, and said it expects revenue in April and May to fall a further 80%. Avis said it expects a gradual recovery beginning possibly in June. 

Hertz shares fell 14.8% to $3.06 on Tuesday. Avis rose 2.22% to $14.28.

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