Advantage Rent A Car would be filing for bankruptcy after Hertz had terminated lease agreements over vehicles that Advantage was able to use in its operations. Advantage was a unit of Hertz Global Holdings Inc hived off to accommodate the deal to purchase Dollar Thrifty.
According to Advantage owners, the book value of the cars received by them from Hertz was 'too high'. As a result, share values of Hertz fell by as much as 17%. In recent move, claiming Advantage had failed to meet some payment obligations, Hertz terminated the lease agreements covering nearly 24,000 vehicles last Saturday.
In order to comply with anti-trust authorities, Hertz had sold off Advantage as a unit to Franchise Services of North America in 2012. Simply Wheelz LLC is a unit of FSNA that operates as Advantage Rent A Car using vehicles leased from Hertz. According to FSNA, Simply Wheelz recorded a loss amounting to USD8.6 million on vehicles sold from the fleet back in June, as there was a 'significant difference' between the actual value from the book value provided by Hertz.
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