The Hertz Corporation, a subsidiary of Hertz Global Holdings, Inc., is an American car rental company and has been in operation since late 1910s. Though it has been working for so long, recently – in late May that is – Hertz filed for bankruptcy. It has had quite a long history of tumultuous financial management. At the time it filed for bankruptcy, it had amassed about $17 billion in debt.
The interesting part begins after the bankruptcy filing. After the company filed for Chapter 11, shares of Hertz plummeted, reaching a low of 40 cents on May 26. But then an odd thing happened. The stock rallied to more than $6 on June 8, after retail investors poured in, expecting it to climb further.
In a highly unusual move, Hertz attempted to capitalize on the spike and announced it planned to offer $500 million in stock — shares Hertz itself admitted could end up worthless. The company then halted the sale of shares to help it through its current troubles after the SEC expressed concern about the deal and launched a review. Hertz put out a warning to investors on June 15, shortly before it called off the deal.