Saying that the COVID-19 pandemic was turbulent for rental car companies is putting it lightly. The windshear practically stripped the paint from the industry, with one of the leading rental car firms losing $1.3 billion in revenue year-on-year in the second quarter of 2020 as fleet utilization dropped from 82% to 28%. That’s a 70% drop in revenue.

After Hertz entered Chapter 11 proceedings, AlixPartners was engaged to defend the first lien lenders’ collateral rights, with an eye to a full recovery as the industry sputtered back to life. We achieved a full par recovery to first lien lenders, including unpaid default interest, and were able to shepherd some of the first lien lenders into underwriting a $1.65 billion debtor-in-possession facility.

Long term, the company exited bankruptcy just over a year later with a sustainable capital structure. Reducing the debt load meant that the company could invest in modernizing its technology and upgrading its fleet to get back on the road.

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