Capital Structure Changes
DNP Select Income (DNP) announced the successful placement of $267 million of floating-rate mandatory redeemable preferred shares, or MRPS. The fund will use the proceeds to redeem all outstanding shares of Series D and Series E remarketed preferred stock. The preferred shares will be redeemed for 100% of their liquidation preference plus accrued and unpaid dividends. The Series D shares will be redeemed March 12, 2014, and the Series E shares will be redeemed March 19, 2014. The fund will use the remaining proceeds from the MRPS placement to repay $128.8 million of the $861.8 million principal outstanding under its credit facility.
Kayne Anderson MLP(KYN) announced last week that it entered into a $150 million unsecured term loan credit facility. The five-year term loan matures in February 2019 and bears interest at a rate of three-month Libor plus 1.3% per year. The fund also announced the pricing of a public offering of common stock. The fund agreed to sell a total of 8 million shares at a price of $37.05 per share (exclusive of 1.2 million additional shares that underwriters may purchase pursuant to a 45-day option to cover overallotments). The net proceeds of $284.7 million will be used to make additional portfolio investments, and the offering is scheduled to close on Feb. 25, 2014.
Two funds announced tender offers recently. The Central Europe, Russia & Turkey(CEE) fund announced the commencement of a self-tender offer to purchase up to 5% of its issued and outstanding shares of common stock at a price equal to 90% of the fund's net asset value. The tender offer will terminate on March 17, 2014. This offer was made in accordance with the fund's discount management program, which provides for up to four consecutive, semiannual tender offers, which are to be conducted if the funds' shares trade at an average discount of more than 10% during the applicable 12-week measurement period.
India Fund (IFN) also approved a tender offer to acquire up to 15% of the fund's outstanding shares at a price per share equal to 98% of the fund's NAV. This offer was made in conjunction with its recent shareholder approval of the elimination of the fund's interval structure.
Several Eaton Vance state municipal-bond funds announced changes that will amend its investment policy and allow unrestricted investments in illiquid securities, effective March 20, 2014. The current policy restricts the funds from investing more than 15% of net assets in illiquid securities. For more details and a full list of the funds affected, please click here.
We're always happy to see a fund lower its fees. Federated Enhanced Treasury Enhanced Income Fund(FTT) announced that its board approved a reduced advisory fee and the extension of its share repurchase program. The fund's advisory fee will decrease to 60 basis points from 80 basis points, effective March 1, 2014.
Korea Fund(KF) announced that Chris Leung will replace Sang Won Kim and become the fund's lead portfolio manager, effective March 1, 2014.
First Trust/Aberdeen Global (FAM) experienced a 15% decline in its per share monthly distribution, to $0.11 per month from $0.13.
Click here for data and commentary on individual closed-end funds. http://news.morningstar.com/PDFs/cefw022514.pdf
Sumit Desai, CFA does not own shares in any of the securities mentioned above.
- Investment & Company Information