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June 19, 2020
Sanity prevails as SEC saves potential equity investors from a world of Hertz
J. Paulo Silva, CFA
Sr. Portfolio Manager

Sanity prevails as SEC saves potential equity investors from a world of Hertz

After a share price surge, Hertz Corporation petitioned for and initially received bankruptcy court approval to raise money via a common stock offering. This was a surprising turn of events for a company that recently filed for Chapter 11 protection. The typical bankruptcy process leaves equity holders with securities worth little to no value. Who would invest new money in a bankrupt equity?

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