(Reuters) – Car rental firm Hertz Global Holdings Inc said it would sell up to $1 billion in shares, cashing in on a huge speculative rise in its share price since filing for bankruptcy late last month.
Since filing for bankruptcy on May 22, Hertz’s shares have risen more than threefold in value. The stock jumped 157% in the week ended June 5, their biggest weekly percentage gain on record.
Hertz is now seeking approval from a bankruptcy court to potentially sell 246.78 million unissued shares to Jefferies LLC.
“The recent market prices of and the trading volumes in Hertz’s common stock could potentially present a unique opportunity for the debtors to raise capital on terms that are far superior to any debtor-in-possession financing,” the company said in a regulatory filing on Thursday.
Hertz said the net proceeds would be used for general working capital purposes.
The company filed for Chapter 11 protection in a U.S. bankruptcy court in Delaware after talks with creditors failed to result in much needed relief.
(Reporting by Sanjana Shivdas in Bengaluru; Editing by Maju Samuel)