Hertz caves to SEC, halts $500M stock sale

The rental car company raised concerns at the SEC

Hertz Global Holdings has suspended its plans to sell $500 million of shares, according to a Securities and Exchange Commission filing.

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The embattled rental car company was considering the stock sale as shares spiked to $5.53 apiece last week after filing for Chapter 11 bankruptcy on May 22 with a debt load of about $19 billion.

In a separate SEC filing earlier this week, the company warned investors about the sale.

"We are in the process of Chapter 11 reorganization cases under the Bankruptcy Code, which may cause our common stock to decrease in value, or may render our common stock worthless" the filing stated.

SEC Chairman Jay Clayton, in an interview with CNBC Wednesday, said the commission had concerns about the sale.

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Hertz was forced to idle about 700,000 vehicles due to the COVID-19 pandemic, which has also pressured rivals including Avis.

Shares ended Tuesday at $1.97 apiece, down 88 percent this year.