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The Hertz Corporation – Debtors’ Motions Indicate “Several Successful Rounds of Robust Bidding and Significant Enhancements;” Indicate Winner Was Selected Evening of May 11th

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May 11, 2021 – The Debtors have filed a pair of motions (to (a) extend certain deadlines and (b) shorten notice/objections periods at Docket Nos, 4632 and 4633, respectively) which provide some insight as to where we stand in the auction pitting rival private equity groups (i) Certares Opportunities LLC, Knighthead Capital Management, LLC and Apollo Capital Management, LP (together, the "Alternative Sponsor Group")  and (ii) Centerbridge Partners, L.P.; Warburg Pincus LLC; and Dundon Capital Partners (together, the "Plan Sponsors").

Together, the motions note that the auction has been going "uninterrupted" from its Monday morning commencement and that more time is needed to file supplemental materials "because of the length of the Auction, which is the product of several successful rounds of robust bidding and significant enhancements." 

With "best and final" offers solicited, the motions indicate that the Debtors "expect to select a plan sponsor this evening [ie of May 11th]…" but need until 5pm today [May 12th] to file the Court required supplemental materials. 

While the Debtors may want more time to file the supplemental materialsthey are not equally keen on providing more time to allow objections to the auction results, asking the Court to extend that objection deadline by a single day (through the 13th) to mirror the one day extension of the supplemental materials extension (through the 12th).

The Deadline Extension Motion

The Debtors' motion states: "the Debtors seek entry of the Proposed Order: (a) extending by twenty-four hours (i) the deadline to file any proposed supplemental materials, including, as necessary, an amended plan, updated solicitation materials, a supplemental disclosure statement, a modified equity purchase and commitment agreement, modified rights offering documents, and other related filings, if any (the “Supplemental Materials Filing Deadline”) from May 11, 2021 at 5:00 p.m. (ET) through and including May 12, 2021 at 5:00 p.m. (ET) and (ii) the Post-Auction Objection Deadline from May 12, 2021 at 4:00 p.m. (ET) through and including May 13, 2021 at 4:00 p.m. (ET)…

On May 10, 2021, and in accordance with the Plan Sponsor Bidding Procedures Order, the Debtors commenced an Auction, which began at approximately 10:30 a.m. (ET) and has proceeded uninterrupted through the date hereof. Although the Debtors have solicited 'best and final' plan proposal from each of the potential plan sponsors and expect to select a plan sponsor this evening [ie of May 11th], the Auction remains ongoing at the time of filing of this Motion. Due to this timing, the Debtors will be unable to file the supplemental materials by the Supplemental Materials Filing Deadline." 

The motion continues, "the Debtors are unable to meet the Supplemental Materials Filing Deadline because of the length of the Auction, which is the product of several successful rounds of robust bidding and significant enhancements to the consideration offered to parties in interest under the Plan….

The Debtors submit sufficient cause exists for the Court to extend the Supplemental Materials Filing Deadline from May 11, 2021 at 5:00 p.m. (ET) through and including May 12, 2021 at 5:00 p.m."

The Motion Requesting Shortening of Notice/Objection Periods

The Debtors' motion to shorten notice and objection periods adds further detail as to timing, asking the Court to set "the Motion to be heard before the United States Bankruptcy Court for the District of Delaware (the “Court”) on May 14, 2021 at 10:30 a.m. (prevailing Eastern Time) (the “Hearing”), (iii) setting the deadline to file objections, if any, to the Motion as May 13, 2021 at 4:00 p.m.

In a curious sentence, this motion adds: "Ample cause exists to shorten the notice and objection periods for the Motion. As discussed above and in the Motion, the Debtors are unable to meet the Supplemental Materials Filing Deadline because several successful rounds of bidding and significant consideration extended the length of the Auction. The continuation of the Auction has provided increased value for the Debtors’ estates, and the Debtors’ should not be prejudiced by allowing the Auction to continue as it has."

After arguing that the successful auction should not be allowed to "continue as it has" and that an opportunity for the runner-up (or anyone else) to object should be shortened lest that successful process continue, the Debtors argue that to do so would perhaps have them run afoul of their requirement to file "Supplemental Materials," yes the very requirement that they already find impossible to meet and which they are asking the Court to extend. The Debtors continue: "Further, if the Motion to Shorten is not granted, the Debtors’ will fail to meet their deadline to submit the Supplemental Materials, which could cause delays that would harm the Debtors estates by jeopardizing the Debtors timely exit from chapter 11."

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The post The Hertz Corporation – Debtors’ Motions Indicate “Several Successful Rounds of Robust Bidding and Significant Enhancements;” Indicate Winner Was Selected Evening of May 11th appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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