Hertz’s scummy debtholders seek emergency relief

Hertz’s scummy debtholders seek emergency relief
Joe007 / Pixabay

Whitney Tilson’s email to investors discussing Hertz’s scummy debtholders; I’m on my first flight in three months this morning.

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Q1 2020 hedge fund letters, conferences and more

Hertz's Scummy Debtholders

1) This is one of the scummiest things I've ever seen. It will be a total disgrace if the court overseeing the Hertz (HTZ) bankruptcy and/or the SEC allow Hertz to issue equity!

David Abrams Explains How To Value Stocks

VolatilityContinued from part one... Q1 hedge fund letters, conference, scoops etc Abrams and his team want to understand the fundamental economics of every opportunity because, "It is easy to tell what has been, and it is easy to tell what is today, but the biggest deal for the investor is to . . . SORRY! Read More

Hat tip to Nate Anderson of Hindenburg Research, who tweeted:

Here's a link to the filing by the debtholders, which reads in part (my emphasis added):

[T]he Debtors now seek emergency relief, to capture the potential value of unissued Hertz shares for the benefit of the Debtors' estates...

The Debtors bring this motion on an emergency basis given the volatile state of trading in Hertz's stock and to ensure that the Debtors are in a position to capture the potential value of Hertz's unissued shares.

Despite the fact that any such equity offering would be terrible for shareholders – diluting them while bailing out debtholders – the stock the stock was up as much as 68% this morning.

First Flight In Three Months

2) As you read this, I'm just about to land in San Francisco.

I took my first flight in three months this morning, flying JetBlue (JBLU) from JFK. While I didn't love the idea of being in a tin can for six hours with a bunch of strangers, Yosemite beckons - and the entire experience was pleasant.

What I observed this morning was consistent with the latest data from the TSA: While "total traveler throughput" yesterday exceeded 500,000 for the first time since March 21, it was still down 81% from the day a year ago. JFK wasn't exactly a ghost town, but it was pretty close...

My flight was a little more than half-full. I was pleased to see that everyone was wearing a mask – the few people who weren't were quickly and politely reminded to do so.

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Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver

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