NEW YORK (TheStreet) -- Shares of Hertz Global (HTZ) rose 3.32% to $28.67 in after-hours trading Thursday after the rental car company reached an agreement in principle with billionaire activist investor Carl Icahn to appoint three new board members.
Vincent J. Intrieri, Samuel Merksamer and Daniel A. Ninivaggi will join as independent directors, at which point three current directors will exit. As part of the agreement, Icahn has agreed not to run a proxy contest at Hertz's annual shareholders meeting next year and agreed to vote in favor of the company's nominees at the meeting.
Icahn disclosed an 8.48% stake in Hertz last month and announced plans to increase value for shareholders. The activist investor said one of his problems with the company was "lack of confidence in management."
Two of the new directors would be part of a five-person search committee for a permanent CEO, Hertz said in a statement.
Separately, TheStreet Ratings team rates HERTZ GLOBAL HOLDINGS INC as a "buy" with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate HERTZ GLOBAL HOLDINGS INC (HTZ) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income, good cash flow from operations, expanding profit margins and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."