Hertz Holdings Netherlands B.V., a wholly-owned subsidiary of
Hertz Global Holdings, I
), yesterday agreed to sell €425 million worth of senior notes in
a private offering. We believe that this move is part of the
company's effort to reduce interest expenses.
The offering, which is expected to close by Nov 20, carries an
annual interest of 4.375% and will mature in 2019. The proceeds
from the transaction will be used to redeem all of the company's
8.50% senior notes due Jul 2015.
Notably, borrowing costs are still very low, which enable
companies to obtain easy financing. Corporate bonds and
borrowings from banks are in high demand as the U.S. treasuries
are yielding low rates. We believe that the initiatives, such as
the above, will provide Hertz Global ample financial flexibility
to drive long-term growth.
Recently, the company posted third-quarter 2013 results with
better-than-expected top- and bottom-line performance. However,
the company has long been grappling with higher debt levels.
Hertz Global ended the third quarter with total debt of $17,136.2
million, cash and cash equivalents of $548.7 million, and
shareholders' equity of $2,820.9 million.
The company is trying hard to strengthen its liquidity
position. In doing so, in March, Hertz Global concluded a senior
notes offering of $250 million due 2018, bearing an interest rate
Other Stocks to Consider
This leading airport car rental brand in the U.S. with
presence at 120 major airports in Europe currently holds a Zacks
Rank #4 (Sell). However, other well-placed stocks in the related
SouFun Holdings Ltd.
). While Command Center and SouFun Holdings have a Zacks Rank #1
(Strong Buy), Furmanite Corporation has a Zacks Rank #2
COMMAND CENTER (CCNI): Get Free Report
FURMANITE CORP (FRM): Get Free Report
HERTZ GLBL HLDG (HTZ): Free Stock Analysis
SOUFUN HLDG-ADR (SFUN): Free Stock Analysis
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