DEFA14A: NYLI CBRE Fund Fights Saba Capital Proxy Challenge

NYLI CBRE Global Infrastructure Megatrends Term Fund urges shareholders to vote the WHITE proxy card to defend against Saba Capital Management's attempt to change its board and governance structure.

Summary

• The Annual Meeting of Shareholders on October 1, 2025, is critical for determining the future of the NYLI CBRE Global Infrastructure Megatrends Term Fund (MEGI).
• MEGI's Board of Trustees recommends voting the WHITE proxy card and discarding any GOLD proxy cards received from Saba Capital Management, L.P. (Saba).
• Saba proposes changes to the Fund's Independent trustees and the elimination of its classified board structure.
• The Board has been proactive in efforts to close the discount, including approving a 15% increase to the Fund's monthly distribution.
• The Fund was renamed to highlight its limited-term structure, designed to benefit long-term shareholders and increase secondary trading market liquidity.
• MEGI was initially structured as a term trust to ensure long-term investors receive Net Asset Value (NAV) upon termination.
• The Fund's discount has narrowed by 57% from -13.78% on August 31, 2023, to -5.87% on September 2, 2025.
• Saba is characterized as a hedge fund acting in its own self-interest, implementing initiatives for short-term profits.
• Adding Saba's trustee nominee could disrupt MEGI's operations, and the nominee may propose a liquidity event that could adversely impact the Fund.
• The Fund's classified board structure supports stability, continuity, independence, and long-term planning, and has been disclosed since inception.
• Shareholders have the right to change their vote before the meeting by signing and returning a new WHITE proxy card, which will replace any previously submitted proxy card.

Sentiment

Score: 7

Explanation: The filing presents a strong defensive stance against an activist investor, highlighting proactive measures taken to improve shareholder value (e.g., distribution increase, discount narrowing) while portraying the opposing party's actions as self-serving and potentially detrimental. The tone is assertive and confident in the current management's strategy.

Positives

• Approved a 15% increase to the Fund's regular monthly distribution.
• Renamed the Fund to highlight its limited-term structure, aiming to benefit long-term shareholders and increase secondary trading market liquidity.
• Initially structured as a term trust to ensure long-term investors receive NAV upon termination.
• The Fund's discount has narrowed by 57% from -13.78% on August 31, 2023, to -5.87% on September 2, 2025.
• The Board maintains confidence in its ability and the investment manager's ability to deliver attractive total returns and income over the life of the Fund.
• The classified board structure supports stability, continuity, independence, and long-term planning.

Negatives

• The Fund is under attack by Saba Capital Management, L.P.
• Saba is described as acting in its own self-interest, implementing initiatives for short-term profits benefiting Saba and its investors.
• Saba's proposed change to the Fund's Independent trustees and elimination of the classified board structure is not warranted.
• Adding Saba's trustee nominee to the Board could disrupt MEGI's operations.
• Saba's trustee nominee may propose a liquidity event that could adversely impact the Fund.

Risks

• Disruption of MEGI's operations if Saba's trustee nominee is added to the Board.
• Potential adverse impact on the Fund from a liquidity event proposed by Saba's trustee nominee.

Future Outlook

The Board and Fund management are committed to continued thoughtful actions designed to enhance long-term shareholder value and improve the relationship between the Fund's Net Asset Value (NAV) and its market price. They maintain confidence in their ability and the investment manager's ability to deliver attractive total returns and income over the life of the Fund.

Management Comments

• "Your vote, no matter the number of shares you own, will have a significant impact on our Funds success."
• "MEGIs Board of Trustees recommends that you vote on the WHITE proxy card today."
• "Our Fund is under attack by Saba."
• "Our Fund plans to fight vigorously against Sabas trustee nominee and will continue fighting for ALL shareholders."
• "We ask that Sabas Gold proxy cards be discarded."

Industry Context

This filing highlights a common scenario in the closed-end fund industry where activist investors like Saba Capital target funds trading at a discount to NAV, often pushing for liquidity events or governance changes to unlock shareholder value. The Fund's actions, such as increasing distributions and renaming, are typical defensive measures employed by management to address shareholder concerns and defend against activist campaigns.

Corporate Governance

Stakeholder Impact

• Shareholders: Directly impacted by the outcome of the proxy vote, potential changes to board composition, governance, and future strategic direction (e.g., a liquidity event proposed by Saba).
• Fund Management: Their ability to continue the current strategy and maintain control of the Fund is challenged by the activist campaign.

Next Steps

• Shareholders are urged to vote on the WHITE proxy card for the October 1, 2025 Annual Meeting.
• Shareholders can change their vote by signing and returning a new WHITE proxy card.
• The Fund plans to fight vigorously against Saba's trustee nominee.

Key Dates

Recommendation

The Fund is actively defending its current strategy and governance against an activist investor. While the reported narrowing of the discount and increased distribution are positive, the ongoing proxy contest introduces uncertainty regarding future management and strategic direction. An investor would likely hold to observe the outcome of the shareholder vote and assess the implications of either outcome before making a definitive buy or sell decision.

Keywords

NYLI CBRE, Global Infrastructure, Megatrends Term Fund, MEGI, Saba Capital, proxy fight, shareholder meeting, classified board, distribution increase, discount narrowing, closed-end fund