CHICAGO--(BUSINESS WIRE)--RiverNorth Capital Management, LLC (“RiverNorth”), an investment management firm specializing in opportunistic strategies, announced the launch of the RiverNorth Opportunistic 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. The Fund was priced at $20.00 per share, and trading on the New York Stock Exchange began on October 26, 2018 under the symbol "RMI.”
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. RiverNorth believes that fundamental and technical factors look positive for the municipal bond market, and significant opportunity exists for discount narrowing in the municipal closed-end fund market, as current discounts are in the 99th percentile of widest discounts.**
“We are delighted to partner with the distinguished municipal bond team at MacKay Shields,” said Patrick Galley, RiverNorth’s Chief Investment Officer. “The Fund seeks to capitalize on market inefficiencies in the municipal closed-end fund and municipal bond markets in order to provide investors with a tax-efficient municipal bond strategy with the potential to deliver enhanced income and additional returns. Through a relative value approach, the Fund will seek to trade and tactically allocate to municipal closed-end funds when discounts are attractive and conversely, tactically decrease our exposure and allocate more capital to the municipal bond income strategy when discounts narrow.”
“MacKay Shields’ research driven investment approach and intense focus on mis-priced municipal securities provides an excellent complement to RiverNorth’s proficiency in deriving value from closed-end fund discount trading opportunities,” said Robert DiMella, Executive Managing Director and Portfolio Manager of MacKay Shields. “Together, we believe the firms’ complementary strategies will allow the Fund to opportunistically generate returns across market cycles.”
The Fund raised gross proceeds of approximately $119 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 gross proceeds of approximately $136.85 million.
The lead managers of the underwriting syndicate were UBS Investment Bank, Morgan Stanley, 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 $3.4 billion in assets under management as of September 30, 2018, 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”) 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 is a fixed-income and equity investment management firm with approximately $114 billion in assets under management as of September 30, 2018. MacKay 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.
*MacKay Municipal Managers™ is a portfolio management team within MacKay
Shields LLC.
**Source: Morningstar, RiverNorth. Represents average
municipal closed-end fund discount as of 10/25/18; discount frequency
calculated from 12/31/96-10/25/18.
RiverNorth is not affiliated with MacKay Shields, UBS Investment Bank, Morgan Stanley, Wells Fargo Securities, RBC Capital Markets and Stifel.
RiverNorth® is a registered trademark of RiverNorth Capital Management, LLC.
©2000-2018 RiverNorth Capital Management, LLC. All rights reserved.
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