RiverNorth Capital Management, LLC (“RiverNorth”), an investment
management firm specializing in opportunistic strategies, announced
the launch of the RiverNorth Managed Duration Municipal Income
Fund, Inc. (the “Fund”), a new municipal bond focused closed-end
fund. RiverNorth will act as the investment adviser to the Fund and
MacKay Shields LLC ("MacKay Shields") will act as subadviser. This
is the second fund co-managed by the investment firms. The Fund
will use the load waived pricing structure pioneered by RiverNorth
last year. As a result, investors will not pay any upfront
expenses, which allows the Fund to be priced at $20.00 per share
with an initial net asset value (NAV) of $20.00 per share. Trading
on the New York Stock Exchange began on July 26, 2019 under the
symbol "RMM.”
The Fund’s primary investment objective is current income exempt
from regular U.S. federal income taxes (but which may be includable
in taxable income for purposes of the Federal alternative minimum
tax). The Fund’s secondary investment objective is total return. As
the investment adviser, RiverNorth will strategically allocate the
Fund’s assets between two principal investment strategies: the
Tactical Municipal Closed-End Fund Strategy, managed by RiverNorth,
and the Municipal Bond Income Strategy, managed by MacKay Shields.
In addition, the Fund will also implement a managed duration
strategy which targets a weighted average effective duration within
three years of the weighted average effective duration of the
Bloomberg Barclays Municipal Bond Index**.
“The Fund is designed to capitalize on market inefficiencies in
both the municipal closed-end fund and municipal bond markets,”
said Patrick Galley, RiverNorth’s Chief Investment Officer. “We
believe significant opportunity exists in the municipal market.
Through opportunistic investments in municipal closed-end funds and
municipal bonds, the Fund will seek to meet its investment
objectives as well as provide investors with the potential for
excess return through closed-end fund discount trading
opportunities and active duration management.”
“We are thrilled to once again partner with the accomplished
municipal closed-end fund team at RiverNorth,” said Robert DiMella,
Executive Managing Director and Portfolio Manager of MacKay
Shields. “We are excited about the Fund and believe that municipals
are one of the most attractive sectors in fixed income today.”
The Fund raised $365 million in its initial public offering of
shares of common stock. Should the underwriters exercise the
overallotment option in full, which may or may not occur, the Fund
will raise approximately $415 million.
The lead managers of the underwriting syndicate were UBS
Investment Bank, Wells Fargo Securities, RBC Capital Markets and
Stifel.
For more information, please visit us at www.rivernorth.com.
About RiverNorth
RiverNorth Capital Management, LLC is an investment management
firm founded in 2000. With approximately $3.8 billion in assets
under management as of June 30, 2019, RiverNorth specializes in
opportunistic investment strategies in niche markets where the
potential to exploit inefficiencies is greatest. RiverNorth is the
investment manager to multiple registered and private funds.
About MacKay Shields LLC
MacKay Shields LLC (“MacKay Shields”) is an indirect
wholly-owned subsidiary of New York Life Insurance Company and a
wholly-owned subsidiary of New York Life Investment Management
Holdings LLC. MacKay Shields is a fixed-income and equity
investment management firm with approximately $123 billion in
assets under management as of June 30, 2019. MacKay Shields manages
fixed-income and equity strategies for high-net worth individuals,
institutional clients, and mutual funds.
The Fund has no operating history. An investment in the Fund is
not appropriate for all investors and is not intended to be a
complete investment program. The Fund is designed as a long-term
investment and not as a trading vehicle.
This document is not an offer to sell any securities and is
not soliciting an offer to buy any securities in any jurisdiction
where the offer or sale is not permitted. This document is not an
offering, which can only be made by a prospectus. The information
in this press release is not complete and is subject to
change.
Investors should read the Fund’s prospectus and consider the
Fund's investment objective, risks, charges and expenses carefully
before investing. The prospectus should be read carefully before
investing. For more information, please read the prospectus, call
your financial professional or call 844.569.4750.
The Fund is a closed-end fund, and closed-end funds do not
continuously issue shares for sale as open-end mutual funds do.
Since the initial public offering has closed, the Fund now trades
in the secondary market. Investors wishing to buy or sell shares
need to place orders through an intermediary or broker. The share
price of a closed-end fund is based on the market's value.
Shares of closed-end investment companies frequently trade at a
discount to their net asset value and initial offering price. The
risk of loss due to this discount may be greater for initial
investors expecting to sell their shares in a relatively short
period after completion of the initial public offering.
Risk is inherent in all investing. Investing in any investment
company security involves risk, including the risk that you may
receive little or no return on your investment or even that you may
lose part or all of your investment. Therefore, before investing in
the common shares of the Fund, you should consider the risks as
well as the other information in the prospectus.
Weighted average effective duration is a mathematical
calculation of the sensitivity of the price of a bond to changes in
interest rates, measuring a bond’s expected life on a present value
basis, taking into account the bond’s yield, interest payments,
final maturity and, in the case of a bond with an embedded option
(e.g., the right of the issuer to call the bond prior to maturity,
or a sinking fund schedule), the probability that the option will
be exercised.
Although the fund is load waived, normal fund expenses still
apply.
Please consult your personal tax advisor regarding the tax
implications of owning this fund.
*MacKay Municipal Managers™ is a trademark used by a portfolio
management team within MacKay Shields LLC.
**The Bloomberg Barclays Municipal Bond Index is considered
representative of the broad market for investment grade, tax-exempt
bonds with a maturity of at least one year. The index cannot be
invested in directly and does not reflect fees and expenses.
RiverNorth is not affiliated with MacKay Shields, UBS Investment
Bank, Wells Fargo Securities, RBC Capital Markets and Stifel.
RiverNorth® is a registered trademark of RiverNorth Capital
Management, LLC.
©2000-2019 RiverNorth Capital Management, LLC. All rights
reserved.
RMI000124 Exp. 7.31.21
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version on businesswire.com: https://www.businesswire.com/news/home/20190730005945/en/
Media Contacts Susan Mellon 312.445.2256
smellon@rivernorth.com
Investor Contact Allen Webb, CFA 312.445.2266
awebb@rivernorth.com
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