The U.S. Treasury Department announced Friday the Capital One (NYSE: COF) warrants it is auctioning off have been priced at $11.75 per issue. The warrants have received authorization to be listed on the New York Stock Exchange under the symbol “COF WS.”
Total proceeds from the auction if all warrants are sold will be $146.5 million. “These proceeds provide an additional return to the American taxpayer from Treasury’s investment in the Company beyond the dividend payments it received on the related preferred stock,” the Treasury said in its press release.
The announcement comes just days after the Treasury Department announced it filed a preliminary prospectus to sell the warrants. The move is just the first in many the Treasury is planning as it looks to completely exit investments in financial institutions that have since repaid TARP funds.
According to the Treasury, the closing is expected to occur on or about December 9, 2009, subject to customary closing conditions. The offering was priced through a modified Dutch auction.
Deutsche Bank Securities Inc. is the lead book-running manager for the auction, while Siebert Capital Markets is the co-manager for the offering.
The Treasury received the Capital One warrants when it supplied the bank with $3.55 billion in financial aid last year from the $700-billion TARP.
Any investors that purchase Capital One warrants at auction is buying the right to attain one share of the firm’s common stock an exercise price of $42.13 for each warrant owned. The warrants are valid until November 14, 2018.
Interested investors can attain copies of the final prospectus supplement relating to these securities from Deutsche Bank Securities, Prospectus Department, Harborside Financial Center, 100 Plaza One, Jersey City, New Jersey 07311-3988, telephone: 1-800-503-4611.
