Hertz priced $350 million in exchangeable secured notes to reduce debt and fund corporate needs at a 6.75% interest rate.
Hertz Global Holdings Inc. (NASDAQ:HTZ) priced a $350 million private offering of 6.75% Exchangeable Senior First-Lien Secured PIK Notes due 2030. The company also secured an option for an additional $50 million in notes, which closed on June 29. Proceeds will pay down revolving credit facility debt and support general corporate purposes.
The notes carry a 6.75% interest rate, payable semi-annually with a 50% cash and 50% payment-in-kind (PIK) split. They are exchangeable into cash, common stock, or a combination at approximately $3.58 per share. Hertz also announced a concurrent public offering of 37,037,037 shares at $2.70 per share to facilitate hedging for note investors.
The notes are guaranteed by Hertz and its subsidiaries, secured on a first-lien basis, and rank equally with existing first-lien credit facilities. The stock offering is contingent on the successful closing of the note offering.