Hertz proposes $100M common stock offering via share lending deal

Hertz Global Holdings, Inc. (NASDAQ: HTZ) announced a proposed offering of $100 million of its common stock through a share lending arrangement with J.P. Morgan Securities LLC, according to a press release.

Under the structure, Hertz will loan shares to J.P. Morgan Securities LLC, which will act as the share borrower and underwriter. J.P. Morgan or its affiliates will receive all proceeds from the sale of the borrowed shares. Hertz will not receive any proceeds from the offering, though it will collect a nominal lending fee for the use of the shares.

The share borrower has indicated it intends to sell the borrowed shares and use the resulting short position to facilitate hedging transactions for investors in a separate private offering of Exchangeable Senior First-Lien Secured PIK Notes due 2030, to be issued by The Hertz Corporation, Hertz's wholly-owned indirect subsidiary. The company noted the stock lending activity could affect the prevailing market price of its common stock.

The borrowed shares must be returned to Hertz under the terms of the share lending agreement. The stock offering is contingent on the closing of the private notes offering, though the notes offering is not contingent on the stock offering closing.

The offering will be made through a SEC-registered prospectus. Hertz is based in Estero, Florida, and operates more than 11,000 rental locations across 160 countries.

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