SCHEDULE: Sixth Street Affiliate Sells $159M LATAM Airlines ADS

Sixth Street Partners' affiliate, Lauca Investments, sold 3.75 million American Depositary Shares of LATAM Airlines Group S.A. for $42.35 per ADS in an underwritten offering.

Summary

• Lauca Investments, LLC, an entity controlled by Sixth Street Partners, sold 3,750,000 American Depositary Shares (ADS) of LATAM AIRLINES GROUP S.A.
• The sale was part of an underwritten offering at a price of $42.35 per ADS, totaling approximately $158,812,500.
• The Underwriting Agreement was signed on August 13, 2025, with J.P. Morgan Securities LLC and Barclays Capital Inc. as underwriters.
• The offering is expected to close on August 18, 2025.
• Following the sale, Lauca entered into a 30-day lock-up agreement, restricting further sales or hedging activities until September 12, 2025.
• Sixth Street Partners Management Company, L.P. and Alan Waxman beneficially own 113,887,693,315 shares of Common Stock, representing 19.8% of the outstanding shares.
• The total outstanding Common Stock is calculated as 574,219,895,457 shares, accounting for recent share repurchases by the Issuer.

Sentiment

Score: 5

Explanation: Neutral. The filing reports a significant shareholder's partial exit, which is a common investment lifecycle event. While it's a sale, it's executed through an underwritten offering, suggesting an orderly process. The impact on the company's fundamentals is indirect.

Positives

• The sale of ADS indicates a liquid market for the shares, allowing a significant holder to monetize a portion of its investment.
• The underwritten offering structure suggests institutional demand and a structured exit for the seller.

Negatives

• A large sale by a significant shareholder (Sixth Street affiliate) could be perceived as a lack of confidence or a move to reduce exposure, potentially putting downward pressure on the stock price.
• The lock-up period, while standard, highlights that further sales by this entity are restricted only for a short term (30 days), after which more shares could potentially enter the market.

Risks

• Potential for future sales by Lauca Investments after the 30-day lock-up period, which could increase supply and depress share price.
• Market perception of a large shareholder reducing its stake.

Future Outlook

The filing primarily details a past transaction (the sale agreement) and its expected near-term closing. It does not provide forward-looking statements regarding the Issuer's business performance or strategic direction, beyond the Reporting Persons' current lack of plans for further transactions described in Item 4(a)-(j) of Schedule 13D.

Industry Context

The airline industry has been recovering from the pandemic, and capital market activities like secondary offerings or large block sales are common as investors adjust portfolios. A significant sale by a major holder like Sixth Street could reflect a strategic portfolio rebalancing or a partial exit from a specific investment, rather than necessarily a negative outlook on the airline sector as a whole.

Comparison to Industry Standards

• The sale of a significant block of shares by a private equity firm (Sixth Street) through an underwritten offering is a standard practice for monetizing large equity positions in publicly traded companies.
• The 30-day lock-up period is a common feature in such offerings, designed to prevent immediate downward pressure on the stock price post-sale.
• LATAM Airlines, as a major South American carrier, operates in a competitive global airline market. While this filing doesn't provide operational metrics, the ability to execute a large secondary offering suggests market confidence in the company's liquidity and valuation, even if a major shareholder is reducing its stake.

Stakeholder Impact

• Shareholders: The sale of a large block of shares by a significant holder could lead to increased supply in the market, potentially impacting share price. The lock-up provides a temporary buffer.
• Company (LATAM Airlines): The transaction does not directly impact the company's operations or balance sheet, as it's a secondary sale. However, it could affect investor sentiment.

Next Steps

• The Underwritten Offering is expected to close on August 18, 2025.
• The 30-day lock-up period for Lauca Investments, LLC will expire on September 12, 2025.

Key Dates

Recommendation

The filing indicates a significant shareholder, an affiliate of Sixth Street Partners, is reducing its stake in LATAM Airlines through a large underwritten offering. While this is a substantial sale, it's a secondary transaction and does not directly impact the company's operational performance or financial health. The orderly nature of the sale via an underwritten offering and the temporary lock-up suggest a managed exit rather than a distressed one. Investors should monitor the stock's performance post-offering and consider the broader market and company fundamentals, but this specific filing does not present a clear 'buy' or 'sell' signal based on the company's intrinsic value.

Keywords

LATAM Airlines, Sixth Street Partners, ADS, American Depositary Shares, Underwritten Offering, Schedule 13D, Share Sale, Lock-up Agreement, Airline Industry, Equity Offering