DEFA14A: BlackRock Receives Support from Glass Lewis in Fight Against Saba Capital

Glass Lewis recommends shareholders vote for BlackRock's board nominees and against Saba Capital's proposals to terminate BlackRock as investment adviser for several closed-end funds.

Summary

• BlackRock announced that Glass Lewis, a leading independent proxy advisory firm, supports the reelection of all BlackRock's board nominees and opposes all proposals by Saba Capital Management to terminate BlackRock as investment adviser for ten closed-end funds.
• Glass Lewis recommends shareholders vote on the WHITE proxy card for BlackRock's nominees at various funds, including BlackRock Capital Allocation Term Trust (BCAT), BlackRock Innovation and Growth Term Trust (BIGZ), and others.
• Glass Lewis does not believe Saba Capital has made a compelling case to support the changes it is seeking at the Funds.
• BlackRock highlights that Glass Lewis recognizes the strength of their board members, the quality of their portfolio management team, and their legacy of delivering for shareholders.
• BlackRock recently announced enhancements across its closed-end fund complex, including discount management programs, distribution increases, and fee waivers, providing $2.9 billion in liquidity.
• Shareholders are urged to vote using the WHITE proxy card and disregard any gold proxy cards from Saba Capital.

Sentiment

Score: 7

Explanation: The document presents a positive outlook for BlackRock as it secures support from Glass Lewis in its defense against Saba Capital's activist campaign. The tone is confident and reassuring, emphasizing the strength of BlackRock's board and management.

Positives

• Glass Lewis supports BlackRock's board nominees and rejects Saba Capital's proposals.
• Glass Lewis believes BlackRock's nominees are more qualified than Saba Capital's nominees.
• Glass Lewis recognizes BlackRock's ability to deliver exceptional distribution rates without excessive fees.
• BlackRock has implemented enhancements to its closed-end fund complex, providing $2.9 billion in liquidity.
• Glass Lewis believes the boards recent actions, particularly the distribution rate increase, are more likely to have been the main contributing factor to the recent narrowing of the Funds NAV discount.
• Glass Lewis states that the market return of the Fund (reflecting reinvestment of dividends and/or distributions at actual reinvestment prices) outperformed the benchmark indices over the observed six-month, one-year and five-year periods.

Risks

• The document mentions forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time.
• Changes and volatility in political, economic or industry conditions, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for the funds or in the funds net asset value.
• The relative and absolute investment performance of the funds and their investments.
• The impact of increased competition.
• The unfavorable resolution of any legal proceedings.
• The extent and timing of any distributions or share repurchases.
• The impact, extent and timing of technological changes.
• The impact of legislative and regulatory actions and reforms, and regulatory, supervisory or enforcement actions of government agencies relating to the funds or BlackRock, as applicable.
• Terrorist activities, international hostilities, health epidemics and/or pandemics and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock.
• BlackRocks ability to attract and retain highly talented professionals.
• The impact of BlackRock electing to provide support to its products from time to time.
• The impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions.

Future Outlook

The press release contains forward-looking statements regarding BlackRock's and the funds' future financial or business performance, strategies, or expectations, which are subject to risks and uncertainties.

Management Comments

• R. Glenn Hubbard, Chair of the Boards of BlackRock Closed-End Funds, stated that the recommendations from Glass Lewis and ISS highlight the strength of their Board members, the quality of their portfolio management team, and their continued legacy of delivering for all shareholders.

Industry Context

This announcement reflects an ongoing proxy battle between BlackRock and Saba Capital, highlighting activist investor interest in closed-end funds and the strategies employed to influence fund management and performance.

Comparison to Industry Standards

• The document does not provide specific comparisons to industry standards beyond mentioning that the Funds comparative performance in terms of both premium/discount to NAV and TSR have been in line with or even outperformed peers.
• It is common for activist investors like Saba Capital to target closed-end funds trading at a discount to NAV, seeking to unlock value through various strategies such as fund termination or changes in management.
• The support from proxy advisory firms like Glass Lewis and ISS is crucial for companies facing activist campaigns, as their recommendations often influence shareholder voting decisions.

Stakeholder Impact

• Shareholders are directly impacted by the outcome of the vote, which will determine the management and direction of the funds.
• The outcome could affect the funds' performance, distribution rates, and overall value for shareholders.
• Employees of BlackRock could be affected depending on the outcome of the vote.

Next Steps

• Shareholders are encouraged to vote using the WHITE proxy card before the upcoming meetings.
• BlackRock will continue to update performance and other data for the funds on its website monthly.

Key Dates

Keywords

BlackRock, Saba Capital, Glass Lewis, proxy, closed-end funds, board nominees, investment adviser, shareholders, BCAT, BIGZ, BMEZ, BSTZ, ECAT, MHN, MPA, BFZ, BNY, MYN