DEFA14A: BlackRock Receives Key Proxy Advisor Support Amidst Saba Capital Challenge

BlackRock secures recommendations from Glass Lewis and ISS supporting its board nominees and opposing Saba Capital's proposals to terminate BlackRock as investment advisor for certain funds.

Summary

• BlackRock has received support from proxy advisory firms Glass Lewis and Institutional Shareholder Services (ISS) regarding upcoming shareholder votes.
• Both Glass Lewis and ISS recommend voting for BlackRock's board nominees at several funds, including BlackRock California Municipal Income Trust (BFZ), BlackRock New York Municipal Income Trust (BNY), and BlackRock MuniYield New York Quality Fund (MYN).
• ISS also recommends voting for board nominee Arthur Steinmetz at BlackRock MuniHoldings New York Quality Fund (MHN) and MYN.
• Both firms recommend voting against Saba Capital Management's proposal to terminate BlackRock as investment advisor for BFZ and BlackRock Science and Technology Term Trust (BSTZ).
• Glass Lewis specifically rejected Saba Capital's nominees for BFZ, BNY, and MYN.
• BlackRock highlights recent 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 received from Saba Capital.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive due to the support from proxy advisors and BlackRock's defense against activist challenges. However, the presence of activist pressure and the need for discount management programs temper the overall outlook.

Positives

• Key proxy advisors Glass Lewis and ISS support BlackRock's board nominees.
• Both firms recommend against Saba Capital's proposals to terminate BlackRock as investment advisor for certain funds.
• BlackRock has taken actions to enhance shareholder value, including discount management programs and distribution increases.
• Glass Lewis views Saba Capital's nominees as underqualified and likely to push for liquidity events.
• ISS recognizes that BFZ has effectively maintained a stable state of affairs over the past year.
• ISS recognizes that MPA distributions have been on par with peers, the NAV discount has been narrower, and fees have been more competitive.

Negatives

• ISS recommended in favor of Sabas nominees for BFZ and BSTZ.
• Saba Capital is actively challenging BlackRock's management of certain funds.
• The need for discount management programs suggests some funds may be trading at a discount to NAV.

Risks

• Saba Capital's continued activism could lead to further challenges and potential changes in fund management.
• Forward-looking statements are subject to numerous assumptions, risks, and uncertainties that could cause actual results to differ materially.
• Changes in market conditions, interest rates, and other factors could impact fund performance and net asset value.
• Legal proceedings and regulatory actions could have an unfavorable resolution.

Future Outlook

BlackRock will update performance and certain other data for the funds on a monthly basis on their website in the Closed-end Funds section of www.blackrock.com, as well as certain other material information as necessary from time to time.

Management Comments

• R. Glenn Hubbard, Chair of the Boards of BlackRock Closed-End Funds, welcomes Glass Lewis's support and appreciates ISS's support for many of the fund's board nominees and rejection of the termination proposals.
• Hubbard states that Saba's campaign has never been about governance, performance, or investment mandates.

Industry Context

Activist investors like Saba Capital are increasingly targeting closed-end funds, seeking to force liquidity events or change investment strategies; BlackRock is actively defending its management against these challenges.

Comparison to Industry Standards

• The document highlights that the unaffected one-, threeand five-year TSRs [total shareholder returns] of the Fund are better than the TSRs of most or all of the funds in the Peer Group.
• ISS notes that MPA's distributions have been on par with peers, the NAV discount has been narrower, and fees have been more competitive.
• ISS notes that MYN and MHN's TSR, NAV discount, distributions, and expenses are all in alignment with peers.

Stakeholder Impact

• Shareholders are encouraged to vote in favor of BlackRock's nominees to maintain stability and potentially benefit from recent enhancements.
• Employees of BlackRock could be affected by the outcome of the proxy vote, particularly if Saba Capital's proposals are successful.
• The outcome of the vote could impact the funds' investment strategies and overall performance, affecting investors.

Next Steps

• Shareholders are to vote on the board nominees and the proposal to terminate BlackRock as investment advisor.
• BlackRock will continue to update performance and other data on its website.

Key Dates

Keywords

BlackRock, Saba Capital, proxy vote, board nominees, investment advisor, closed-end funds, Glass Lewis, ISS, BFZ, BNY, MYN, MHN, MPA, BSTZ