RiverNorth Capital Management, LLC (“RiverNorth”), an investment
management firm specializing in opportunistic strategies, announced
the launch of the RiverNorth Flexible Municipal Income Fund II,
Inc. (the “Fund”), a new municipal 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 fourth fund co-managed by the investment firms. The Fund
will use the load waived pricing structure pioneered by RiverNorth.
As a result, investors will not pay any upfront expenses, which
allows the Fund to be priced at its initial net asset value (NAV)
of $20.00 per share. Trading on the New York Stock Exchange began
on February 24, 2021 under the symbol "RFMZ.”
“We are delighted to announce the successful launch of the Fund,
which was driven by strong investor demand for additional access
points to the municipal asset class,” said Patrick Galley,
RiverNorth’s Chief Executive Officer and Chief Investment Officer.
“We view the current market environment as an attractive entry
point for our investment strategy and fertile ground for active
trading. In our experience, an opportunistic approach to buying
closed-end funds has the potential to provide excess return. When
discounts widen, we intend to allocate more of the Fund’s capital
to closed-end funds and when discounts narrow, we would monetize
that return by selling closed-end funds and rotating capital to
MacKay Municipal Managers for direct investments in municipal
securities.”
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.
As a means to potentially add trading support in the secondary
market, the Fund intends to implement a common share repurchase
plan, which is expected to start approximately 60 calendar days
following the overallotment period. The repurchase plan will
continue until the earlier of (i) repurchases of 2,200,000 of its
outstanding shares in the open market or (ii) 90 calendar days
following the start of the plan.
“We are thrilled to join RiverNorth for a fourth time on this
new closed-end fund,” said Robert DiMella, Executive Managing
Director and Portfolio Manager of MacKay Shields. “We think this
specific type of municipal closed-end fund is about as ideal as it
gets. What I mean by that is it has two active money managers
coming together to try to extract the full value and the best
opportunities that are in the municipal marketplace. In our view,
it’s really a best ideas kind of strategy, from closed-end funds to
individual municipal bonds.”
The Fund raised $440 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 $506 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 $4.4 billion in assets
under management as of January 31, 2021, 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 $158.6 billion in
assets under management as of January 31, 2021. 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.
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 owned by MacKay
Shields LLC used to describe a portfolio management team within
Mackay Shields LLC. ©2021, MacKay Shields LLC. All Rights
Reserved.
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.
©2000-2021 RiverNorth Capital Management, LLC. All rights
reserved.
ALPS Distributors, Inc. FINRA Member Firm.
RMI000199 Exp. 3.31.23
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version on businesswire.com: https://www.businesswire.com/news/home/20210226005506/en/
Chris Lakumb, CFA, CAIA 312.445.2336 clakumb@rivernorth.com
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