PR Newswire
BATON ROUGE, La., Nov. 8, 2021
BATON ROUGE, La., Nov. 8, 2021 /PRNewswire/ -- Prescience Point Capital Management, ("Prescience Point"), a research-focused, catalyst-driven investment firm that seeks to earn superior risk-adjusted returns uncorrelated to the broader market, today issued the following open letter to investors regarding new, positive findings related to the publicly-traded warrants of AerSale Corporation (Nasdaq: ASLE) ("AerSale" or "the Company").
Dear Fellow AerSale Shareholders, Warrant Holders and Other Interested Parties:
In a research report published on October 27, 2021, Prescience Point concluded that AerSale is one of the most undervalued public companies we have ever seen. We continue to believe that the Company's shares could double within a month due to several near-term catalysts, which include FAA approval and an initial order for AerAware, the Company's game-changing wearable heads up display product, as well as our view that the Company will have to significantly raise its FY 2021 guidance in connection with its third quarter conference call, scheduled for Tuesday, November 9, 2021.
Based on conservative assumptions, we believe AerSale shares are worth $47 today, and are likely to exceed $100 within the next two to three years.
We believe at the moment there is confusion among investors regarding when AerSale will be able to redeem its public warrants (Nasdaq: ASLEW). Our research over the past few weeks has provided clarity on this matter and shows, rather definitively, that AerSale is restricted by law from redeeming its public warrants before October 1, 2022. This is extremely positive for AerSale's public warrant holders, not only because it means that the warrants will remain outstanding for nearly one year or more, but also because it means that the warrants are currently undervalued. At the moment, the Company's public warrants trade closely in-line with their intrinsic value, which means that the market is incorrectly assigning zero time premium to them. We believe these warrants should include a time premium of at least $1.00.
Our conclusions are based on the following key findings:
Based on the above, we cannot imagine a scenario where a warrant redemption by AerSale would be allowed by the PSP statutes or the PSP agreements prior to October 1, 2022. Under each statute it is clear that failure to comply with the provisions could result in the "clawback of any financial assistance provided upon failure" by a recipient to comply with the buyback provisions.
However, more concerning is the potential for civil and criminal liability relating to a warrant redemption by AerSale or an affiliate prior to October 1, 2022. By signing PSP1, PSP2 and PSP3, AerSale acknowledged that a materially false, fictitious, or fraudulent statement (or concealment or omission of a material fact) in connection with this Agreement may result in administrative remedies as well as civil and/or criminal penalties. The Treasury was also very clear in each PSP agreement that it would not hesitate to refer any noncompliance or any allegations of fraud, waste, or abuse to the Treasury Inspector General.
We hope that you find the information included herein about AerSale's public warrants useful and instructive. Should the need arise, we will provide further updates to the public on this and other matters related to AerSale on our website and Twitter account.
Warm Regards,
Eiad Asbahi, CFA
Prescience Point Capital
Prescience Point has a long position in shares and warrants of AerSale and stands to benefit if the share price rises.
About Prescience Point Capital Management
Prescience Point Capital Management is a research-focused, catalyst-driven investment firm that seeks to earn superior risk-adjusted returns uncorrelated to the broader market. Unlike traditional investment strategies, we are unconstrained and can opportunistically invest globally, across asset classes, industry verticals and capital structures. Whether investing in misunderstood distressed assets, creating value through shareholder activism, or uncovering fraud, we seek to capitalize on opportunities that others miss or fall outside the rigid mandates of most investment firms.
Our uniqueness resides in our unconventional thinking, deep research, intellectual curiosity and willingness to go against the prevailing wisdom.
The firm was founded by investor Eiad Asbahi in 2009 and is headquartered in Baton Rouge, LA.
For more information please visit www.presciencepoint.com or follow @PresciencePoint.
Prescience Investment Group, LLC is a member of the Financial Industry Regulatory Authority, CRD number 152721.
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SOURCE Prescience Point Capital Management
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