Car rental company Hertz Global is making its public debut — again.
The company, which filed for bankruptcy last summer from which it finally emerged from on June 30, has filed paperwork with the SEC on Friday for an IPO. After announcing such plans back in August concurrently with its second quarter earnings, Hertz plans to list its shares on the Nasdaq under the ticker symbol HTZ with an offering size of $100 million. The company failed to disclose the share price or how many shares would be offered.
Hertz, which has thus far been trading on the Over-the-Counter Bulletin Board under HTZZ, ran into financial turmoil during the height of the pandemic in 2020. When Covid-19 decimated domestic and international travel, car rental companies such as Hertz found themselves with too many vehicles in their fleet, many of which they were forced to sell in order to raise much-needed cash.
Now, however, with travel rebounding and an ongoing global semiconductor shortage that is significantly constraining the supply of new vehicles from automakers, car rental companies have been struggling to restore their once-large fleets. This has sent rental car rates soaring, which are now more than 50% higher in September compared to the same month in 2019.
Since emerging from bankruptcy, Hertz shares have benefited from a significant increase; however, trading activity has remained subdued because about only 3% of the company’s 471 million shares are eligible for trade. The remainder of Hertz’s stock— approximately 457 million shares— was bought by institutional investors during the rental car company’s reorganization proceedings. However, the restricted shares will be suitable for sale come the end of December, once the lockup rules and limitations as per SEC Rule 144 are lifted.
Information for this briefing was found via Hertz Global Holdings Inc. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.