Judge rules that Hertz can sell $1 billion worth of new stock, dealing a blow to investors who gobbled up shares after its bankruptcy
A logo of the American car rental company Hertz can be seen at Bordeaux Airport in Merignac
Hertz, the car rental giant that filed for bankruptcy in May due to the coronavirus pandemic, can sell $ 1 billion in new shares to raise money, according to the Wall Street Journal.
Hungry traders have swallowed the stock up since bankruptcy, and the company's lawyers called this volatility a "unique opportunity" to support their cash registers.
After filing Chapter 11 on May 22, Hertz shares soared and the stock flew onto Robinhood's list of the most popular names. However, the newly issued shares will effectively depreciate existing shares and send the share down on Friday after close of trading.
The company received a delisting announcement from the New York Stock Exchange this week, and it plans to appeal to continue trading its shares.
Hertz also wanted to save money by terminating leases for more than 144.00 vehicles, which could save up to $ 80 million.
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Hertz hit a whip in the trade when his business grew rapidly thanks to the corona virus
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