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BlackRock Advisors, LLC and the Boards of Directors/Trustees of the BlackRock Closed-End Funds (the “Boards”) today announced that, for each of the BlackRock closed-end funds with auction rate preferred shares (“ARPS”) outstanding (the “Funds”), BlackRock, with the approval of and subject to the guidance of the Boards, is currently in active negotiations with various liquidity providers regarding the prospective issuance of alternative financings, including alternative preferred stock structures like variable rate demand preferred shares (VRDP) and variable municipal term preferred shares (VMTP) and the expanded use of tender option bonds (TOBs) (collectively, “Alternative Financing”), in order to provide liquidity to holders of ARPS issued by the Funds. Provided such negotiations are successful and based upon the facts and circumstances surrounding each Fund, the Boards intend to redeem the outstanding ARPS over the next twelve months where appropriate and in the best interest of each of the Funds and their respective shareholders.
There is no guarantee that all or a portion of a particular Fund’s ARPS will be redeemed. The timing of each Fund’s replacement of ARPS with Alternative Financing may vary and is subject to a number of factors, including, but not limited to, the availability of Alternative Financing, approval by the Fund’s Board of the Fund’s leverage policy and of the terms and pricing for the Alternative Financing, the ability to obtain necessary ratings for Alternative Financing, the cost, benefits and tax consequences to Fund shareholders of other potential forms of financial leverage, the willingness of buyers to purchase securities issued in Alternative Financing arrangements, eligibility of collateral held by the Funds, term-related considerations and other market conditions (including interest rates), any of which for a given Fund may delay or prevent redemption of that Fund’s ARPS.
While any particular Fund may or may not redeem its outstanding ARPS, the intention of the Boards is to redeem ARPS where practicable. The Boards will determine, based on the facts and circumstances applicable to each Fund at any particular time, whether available alternative forms of leverage are appropriate and in the best interest of the Fund and all of its shareholders.