Catalyst Capital Group Inc.’s bid for bankrupt Advantage Rent A Car was approved at auction yesterday over the only other bid, from Sixt SE, according to court documents.
Catalyst, a Canadian private-equity firm, supplied Advantage with a $36 million bankruptcy (DIP (“debor-in-possession”) loan on Dec. 3. Catalyst’s offer would forgive the full amount of the loan in exchange for the assets of Advantage. Exact terms of the deal had not yet been filed by the court as of this writing.
According to court documents, Catalyst revised its bid and agreed to waive the previously declared “Events of Default” under its DIP loan. In so doing, Catalyst waived its right to demand full repayment of its loan to Advantage sooner than it was originally due.
Sixt elected not to submit another bid in response to the revised Catalyst bid.
Advantage will ask the U.S. Bankruptcy Court in Jackson, Miss., to approve the sale on Dec. 17. The sale is also subject to the approval of federal regulators.
Advantage operates 72 car rental locations in 33 states. The company was declared bankrupt on Nov. 5 by its owner, Franchise Services of North America Inc. Advantage was spun off from Hertz to satisfy antitrust stipulations with the Federal Trade Commission.
For an analysis of what's next for Advantage, read this Auto Focus blog.