The U.S. Department of the Treasury has announced plans to conduct a series of auctions, selling its warrants to purchase the common stock of certain publicly traded airlines. The intended buyers are qualified institutional investors, institutional accredited investors, or the issuing airlines themselves. The proceeds from these sales will provide additional returns to American taxpayers following the financial assistance and liquidity that the Treasury provided to these airlines during the pandemic.
In 2020 and 2021, under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the Consolidated Appropriations Act, 2021; and the American Rescue Plan Act of 2021, Treasury offered financial assistance and loans to U.S. airlines and certain other types of businesses. More information about these programs, the warrants being sold, and auction procedures can be found on their website.
The Treasury’s financial agents for this operation are Houlihan Lokey Capital, Inc. and Loop Financial Consulting Services, LLC. They will assist in coordinating and conducting the auctions. Prospective bidders interested in participating must deliver a complete Bid Package by 5:00 p.m. Eastern Time on May 24, 2024. The auctions are expected to commence in the week of June 3, 2024.
The auction transactions will be exempt from the Securities Act of 1933 (the Act). The warrants that will be sold have not been registered under this act and may not be offered or sold in the United States or to U.S. persons without registration under or an applicable exemption from registration requirements of this act and applicable state securities law.
These warrants will only be offered to “qualified institutional buyers” as defined in Rule 144A under the Act, certain institutional “accredited investors” as defined in Rule 501(a) under the Act, and issuers of relevant warrants. This press release nor information regarding auction on Treasury’s website does not constitute an offer to sell or the solicitation of an offer to buy the warrants or any other securities, and shall not constitute an offer, solicitation or sale in any jurisdiction in which, or to any persons to whom, such offering, solicitation, or sale would be unlawful.
