Austerlitz I and II (AUS, ASZ) File to Liquidate Early

Austerlitz I (NYSE: AUS) and Austerlitz II (NYSE: ASZ) both filed proxies this afternoon stating that their sponsors are seeking shareholder approval to liquidate early.

The sponsors, Cannae Holdings, Inc. (NYSE: CNNE) and Trasimene Capital Management, believe that a completion of a suitable merger is highly unlikely, and it would be in the shareholders’ best interests to return the cash in trust in 2022 rather than wait for expiration in 2023. However, it should be noted that it’s also in the best interest of the sponsors to do so before December 31st to avoid the 1% excise tax on share buybacks.

Both SPACs had 24 months on their clock to complete a transaction with deadlines of March 2, 2023, but today’s filing is asking shareholders to approve an amendment during a November meeting that would allow the SPACs to redeem their shares prior to December 31, 2022.

Austerlitz I and II disclosed that since their IPOs in February 2021, Cannae and Trasimene Capital have reviewed hundreds of potential merger partners, but were never able to secure a partner and are no longer seeking to do so. The SPACs noted in a press release, “…some prospective partners did not meet the Sponsors’ investment criteria, and some pursued other strategic options like an IPO or full or partial sale. Some eventually declined to merge with ASZ due to poor stock price performance in the SPAC and IPO markets.”

While Austerlitz II was never able to secure a deal, Austerlitz I did announce a $3.2 billion business combination with online gaming company Wynn Interactive, a subsidiary of a listed company, Wynn Resorts (NASDAQ:WYNN). The deal was announced on May 10, 2021, but was later mutually terminated on November 12, 2021. Wynn’s statement on the termination implied that it felt ultimately it didn’t need the money, noting that “we expect the capital intensity of the business to decline meaningfully beginning in the first quarter of 2022”.

AUS holds $690 million in its trust, while ASZ holds $1.38 billion in its trust. Both SPACs expect to return $10 per public share to their holders.

This early liquidation comes just days after Liberty Media (Nasdaq: LMAC) filed a proxy to do the same. LMAC also cited a declining IPO market in 2022, and market volatility prevented the company from securing a compelling target. While AUS and ASZ, will need to first approve an early liquidation date, today’s announcement technically marks the 31st and 32nd SPACs that intend to liquidate in 2022 thus far.