Hertz UK Receivables scheme sanction hearing rescheduled for Feb. 18

By Sarah Lizee

Olympia, Wash., Feb. 2 – Hertz UK Receivables Ltd. announced that a sanction hearing in relation to a scheme of arrangement for its outstanding €225 million 4 1/8% senior notes due 2021 (ISIN: XS1492665770) and outstanding €500 million 5½% senior notes due 2023 (ISIN: XS1790929217) has been moved to Feb. 18 from Feb. 5.

The scheme proposes that creditors will authorize the bifurcation of their U.S. guarantee claims from their remaining claims outstanding under the existing notes, including the claims against each of the issuers and their international group claims, the allowance of the replacement U.S. unsecured claims, and the subsequent sale of those replacement U.S. unsecured claims, in line with a U.S. guarantee claims agreed auction process.

The cash proceeds realized from the U.S. guarantee sale are to be applied in partial redemption of amounts outstanding under the existing notes on a pro rata basis, prior to the implementation of the notes exchange.

To facilitate the U.S. guarantee sale, Hertz Corp., on behalf of itself and the Chapter 11 debtors, has filed a motion with the U.S. Bankruptcy Court for the District of Delaware seeking the bifurcation order. The bifurcation order is a condition to completion of the restructuring.

The bifurcation motion was originally scheduled to be heard by the court starting on Jan. 26, but the hearing was rescheduled to Feb. 24 in order to provide parties in the United States additional time to engage with respect to the proposed bifurcation and European restructuring.

Hertz UK therefore elected to defer the sanction hearing to better align the scheme process with the bankruptcy court hearing on the bifurcation motion.

The requisite majorities of scheme creditors voted to approve the scheme at a meeting held on Jan. 15. Creditors representing 88.5% of scheme claims by value voted at the scheme meeting. Of those, 131 creditors representing 99.98% by value voted to approve the scheme, and one scheme creditor representing 0.02% by value voted against the scheme.

Hertz UK is an Uxbridge, England-based subsidiary of Hertz Global Holdings, Inc. Hertz is an Estero, Fla.-based car rental company. It filed Chapter 11 bankruptcy on May 22, 2020. The case number is 20-11218.

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