Hertz Global (HTZ) Stock: Why The Price Increased

By Amit Chowdhry ● Nov 29, 2021
  • The stock price of Hertz Global Holdings Inc (NASDAQ: HTZ) increased by 5.99% in the most recent trading session. This is why it happened.

The stock price of Hertz Global Holdings Inc (NASDAQ: HTZ) increased by 5.99% in the most recent trading session. Investors are responding positively to Hertz Global announcing that its Board of Directors has authorized a share repurchase program of up to $2 billion of the company’s outstanding common stock.

The repurchase program is effective immediately and will initially comprise the remaining $200 million that was authorized for repurchase at the time of the company’s offering and listing on NASDAQ. And Hertz will be able to pursue the balance of the authorized amount upon completion of its previously disclosed tender offer and consent solicitation with respect to its outstanding Series A Preferred Stock, so long as holders of a majority of the Series A Preferred Stock tender such shares in the tender offer or deliver consents to certain amendments to the Series A Preferred Stock.

The investment funds, accounts and other entities owned (in whole or in part), controlled, managed or advised by Apollo Capital Management, L.P. and its affiliates, as holders of a majority of the outstanding Series A Preferred Stock, have agreed on the terms and subject to the conditions contained in an agreement between Hertz and Apollo to tender in the offer their shares referred to therein and to consent to the such amendment effective upon the completion of the tender offer.

The repurchase program enables for ongoing and profitable investment in the business while utilizing moderate balance sheet leverage and facilitating opportunistic share repurchases. And the company plans to maintain net corporate leverage of no more than 1.5x.

The repurchases will be made at management’s discretion through a variety of methods, such as open-market transactions (including pre-set trading plans), privately negotiated transactions, accelerated share repurchases, and other transactions in accordance with applicable securities laws. The program has no time limit. And the share repurchase authorization does not obligate the company to acquire any particular amount of common stock and can be discontinued at any time. But there can be no assurance as to the timing or number of shares of any repurchases.

Disclaimer: This content is intended for informational purposes. Before making any investment, you should do your own analysis.