DEFC14A: Saba Capital Launches Proxy Fight to Shake Up BlackRock New York Municipal Income Trust Board

Saba Capital is soliciting proxies to elect its nominees to the board of BlackRock New York Municipal Income Trust, aiming to address the fund's trading discount and corporate governance issues.

Summary

• Saba Capital Management is seeking shareholder support to elect its two nominees, Ilya Gurevich and Jennifer Raab, to the Board of Trustees of BlackRock New York Municipal Income Trust at the upcoming 2024 annual meeting.
• Saba believes the current board needs fresh perspectives to tackle the fund's persistent trading discount and corporate governance concerns.
• The proxy statement highlights that the election of Saba's nominees would send a strong message to the fund's management regarding shareholder dissatisfaction.
• Saba is not making a recommendation on the election of the Class II trustee to be voted on by the holders of preferred shares.
• As of April 22, 2024, Saba and its affiliates beneficially own 2,195,487 common shares of the fund.
• The fund's board consists of ten trustees divided into three classes, with two Class II trustees to be elected by common and preferred shareholders voting together.
• Saba intends to deliver the proxy statement to holders of at least the percentage of the fund's voting shares required to elect the nominees.
• The proxy solicitation is being made by Saba and not on behalf of the board or management of the fund.
• Saba estimates the costs of the proxy solicitation to be approximately $150,000 and does not intend to seek reimbursement from the fund.

Sentiment

Score: 7

Explanation: The document presents a confident stance from Saba Capital regarding their nominees and their ability to improve the fund's performance. While highlighting issues with the current management, the overall tone is assertive and optimistic about the potential for positive change.

Positives

• Saba's nominees possess markets experience, a deep understanding of retail investors needs, corporate governance expertise and capital allocation skills.
• The nominees have agreed to being nominated and have confirmed their willingness to serve on the board if elected.
• Saba has agreed to defend and indemnify the Nominees against any losses that may be incurred by such Nominee in the event he or she becomes a party to litigation based on his nomination as a candidate for election to the Board and the solicitation of proxies in support of his election.

Negatives

• The fund has a large and persistent trading discount.
• The fund has anti-shareholder governance practices.
• Even if both of the Nominees are elected, because the Nominees would only represent a minority of the members of the Board, there can be no assurance that they would be able to implement the actions that they believe are necessary to enhance shareholder value without the support of the other members of the Board.

Risks

• There is no assurance that any of the Funds nominees will serve as a trustee if one or more of the Nominees are elected to the Board.
• Even if both of the Nominees are elected, because the Nominees would only represent a minority of the members of the Board, there can be no assurance that they would be able to implement the actions that they believe are necessary to enhance shareholder value without the support of the other members of the Board.

Future Outlook

Saba intends to supplement the proxy statement with the date, time, and location of the Annual Meeting and the record date for determining shareholders entitled to vote once the Fund publicly discloses this information.

Management Comments

• We believe that BlackRock and the Funds trustees must be held accountable for the Funds large and persistent trading discount and its anti-shareholder governance practices.
• Sabas highly qualified slate of Nominees will ensure the Board has the right mix of experience to address the Funds critical challenges.

Industry Context

This proxy fight is part of a broader trend of activist investors seeking to influence the management and direction of closed-end funds to address issues such as trading discounts and corporate governance.

Comparison to Industry Standards

• Saba Capital's actions are comparable to other activist campaigns targeting closed-end funds managed by large firms like BlackRock, where activists seek board representation to improve fund performance and shareholder value.
• Similar campaigns often focus on issues like discount narrowing, fee reduction, or fund termination, mirroring Saba's stated goals for the BlackRock New York Municipal Income Trust.

Stakeholder Impact

• Shareholders could benefit from a narrowed trading discount and improved corporate governance if Saba's nominees are elected.
• The current board and management may face increased pressure to address shareholder concerns.
• Employees of the fund may experience changes depending on the outcome of the proxy vote and any subsequent strategic shifts.

Next Steps

• Shareholders are urged to sign, date, and return the GOLD proxy card to vote for Saba's nominees.
• Saba will supplement the proxy statement with the date, time, and location of the Annual Meeting once it is publicly disclosed by the Fund.

Key Dates

Keywords

proxy solicitation, board of trustees, Saba Capital, BlackRock New York Municipal Income Trust, corporate governance, trading discount, nominees, shareholders