ESTERO — Hertz Global Holdings, working its way through bankruptcy, has reached an agreement to sell its fleet management entity, Donlen Corp., to financial services giant Athene Holding Ltd.
The deal, for about $875 million, including an anticipated cash payment of $825 million, requires approval from the bankruptcy court, according to a statement. The sale is considered a "stalking horse bid," the release adds, meaning the agreement establishes a minimum sale price for Donlen, and other entities can outbid Athene, a publicly-traded financial services company with $191.1 billion in assets. Apollo Global Management, which is behind some of a $4 billion financing package for Hertz to improve its fleet, has a stake in Athene.
"The agreement to sell our Donlen business is another significant accomplishment for Hertz during our financial restructuring, following the $1.65 billion debtor-in-possession financing and $4 billion fleet financing recently approved by the Bankruptcy Court,” Hertz President and CEO Paul Stone says in the statement. “As we continue to work to position Hertz and our business for the future, we believe this transaction provides significant additional flexibility to help us achieve our strategic and financial objectives.
"We are excited about the opportunity to partner with the strong team at Donlen to acquire an industry-leading fleet management franchise that is well-suited to meet our objective of sourcing attractive, differentiated long-term investments for our growing portfolio,” adds Athene Chairman and CEO Jim Belardi in the statement. “In support of the business, strengthening the balance sheet and its significant growth opportunity, we are making an upfront investment of approximately $1 billion, and we are prepared to provide incremental capital that would support approximately $2 billion of additional growth in the fleet.”