Looking to share U-Haul/moving van rental for in-town trip
Question:
I need to move two love seats from a home in Orleans/Fallingbrook to Aylmer. My budget is very tight at the moment, however, and I cannot afford the cost of a U-Haul on my own. If anyone is planning a move that coincides with my needs and have space to accommodate me, please email me. Naturally, I will be happy to share the cost of the rental with you.
Answer:
U-Haul's parent company is having serious difficulty securing the
emergency finance it needs and the van rental group could file for
bankruptcy as early as Friday.
Amerco, whose orange and white U-Haul vans are a familiar sight on roads
throughout the US, has been in negotiations with creditors since
announcing in March that it was near to agreeing a new credit facility
of $866m.
The company said then that the financing deal would be in place during
May. But it has issued no news since then and some analysts believe a
bankruptcy filing is inevitable.
People close to the discussions said on Thursday that a last-minute deal
was still possible but that some creditors and bondholders were running
out of patience.
One analyst said that shareholders might see substantial benefit if the
company went into bankruptcy. "If the company is declared bankrupt, it
is worth significantly more than the current stock price," said Ian
Gilson of Roth Capital Partners.
Mr Gilson believes that the company could restructure, sell some
operations, see off itscreditors and still be viable. Amerco has about
$1bn in debt on its balance sheet and another $1bn in leasing
obligations. Its financial difficulties started last October when it
missed a $100m bond payment five days after reassuring investors that it
had enough cash to meet its obligations.
It has since missed a further debt payment and three coupon payments on
its preferred shares, according to credit rating agencies. Bob
Jankowitz, analyst at Moody's, said: "The probability of bankruptcy gets
higher with each day we go forward."
Last month Amerco, which has denied it is in danger of bankruptcy,
parted company with Crossroads, the turnround specialist it hired last
year. Crossroads refused comment. Amerco said it had completed its
assigment. The group has since hired Alvarez & Marsal, another turnround
specialist.
Any bankruptcy filing could yet be postponed. The summer months are when
the company generates the most cash from Americans taking to the
road.
Amerco is run and in large part owned by members of the Shoen family,
descendants of the moving company's founder L.S. Shoen. The group's
corporate governance record is cited by analysts and creditors as a
major worry and the company has responded recently by hiring a new chief
finance officer and creating an independent governance committee.
However it announced in May that the Securities and Exchange Commission
(news - web sites), the US's chief financial regulator, was probing its
financial statements. Restated financials are due to be filed by the end
of the month.
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