Hertz Secures Dismissal of Lawsuit in Delaware Over Warrants

Hertz Global Holdings has won a lawsuit dismissal in Delaware over warrants. The company operates vehicle rental and leasing businesses globally from 11,400 locations in 160 countries. It owns the Firefly vehicle rental brand and Hertz 24/7 car sharing business. Hertz Global Holdings employs 27,000 people. The company operates primarily through its Hertz, Dollar, and Thrifty brands.

Hertz Global Holdings, the multinational vehicle rental and leasing company, has achieved a significant legal victory in the Delaware Court of Chancery. The company, which operates under the Hertz, Dollar, and Thrifty brands and employs over 27,000 people, has successfully dismissed a lawsuit filed by warrant holders seeking over $187.5 million in damages [1].

The plaintiffs, investment funds tied to Discovery Capital Management, alleged that Hertz's buyback of $3.4 billion of common stock and borrowing of $2.2 billion of new debt constituted a recapitalization of the company, triggering change of control provisions under the warrant agreements. However, the court ruled that the buybacks and debt issuance did not amount to a reorganization of the company's capital stock [2].

This legal victory is a positive development for Hertz Global Holdings, which has been navigating a challenging business environment in recent years. The company filed for bankruptcy in May 2020 and emerged from Chapter 11 protection in June 2021. In addition to the warrant dispute, Hertz is also facing litigation related to its acquisition of Swervepay Acquisition LLC [2].

Despite these challenges, Hertz Global Holdings has been making progress in its business operations. In the first quarter of 2023, the company reported a net income of $18 million, compared to a net loss of $1.2 billion in the same period in 2022. The company's revenue also increased by 24% year-over-year to $2.2 billion [3].

Looking ahead, Hertz Global Holdings is expected to continue focusing on its core business operations and leveraging its strong brand to drive growth. The company is also exploring opportunities to expand its business through strategic partnerships and acquisitions.

References:

[1] Bloomberg Law. (2023, June 12). Hertz warrant holders take legal action for $187.5 million payment. Retrieved from https://news.bloomberglaw.com/bankruptcy-law/hertz-warrant-holders-take-legal-action-for-188-million-payment

[2] Bloomberg Law. (2023, June 12). Delaware Chancery Court calendar for the week of June 18. Retrieved from https://news.bloomberglaw.com/litigation/this-week-in-chancery-court-hertz-carlyle-group-swervepay

[3] Hertz Global Holdings. (2023, April 26). Hertz Global Holdings Reports First Quarter 2023 Results. Retrieved from https://www.hertz.com/content/dam/hertz/investors/press-releases/2023/Hertz-Global-Holdings-Reports-First-Quarter-2023-Results.pdf