BlackRock Corporate High Yield Fund, Inc. (NYSE: HYT) (the
"Fund") today announced that its Board of Directors (the "Board")
has approved the terms of the issuance of transferable rights
("Rights") to the holders of shares of the Fund's common stock (par
value $0.10 per share) ("Shares") as of September 20, 2022 (the
"Record Date"). Holders of Rights will be entitled to subscribe for
additional Shares (the "Offer") at a discount to the market price
of the Shares.
After considering a number of factors, including potential
benefits and costs, the Board and the Fund's investment adviser,
BlackRock Advisors, LLC (the "Adviser"), have determined that it is
in the best interests of both the Fund and its shareholders to
conduct the Offer and increase the assets of the Fund available to
take advantage of existing and future investment opportunities that
may be or may become available, consistent with the Fund's primary
investment objective of providing shareholders with current income
and secondary objective of providing shareholders with capital
appreciation. All expenses of the Offer will be borne by the
Adviser, and not by the Fund or any of the Fund's
shareholders.
The Adviser believes this is an attractive time to raise
additional assets for the Fund based on several factors, including
the following potential benefits:
- Opportunities in the high yield market: High yield
credit spreads have increased since the end of 2021 and the sector
offers some of the highest yields in the fixed income market1
- Rewards for shareholders: the Offer provides
shareholders with an opportunity to buy new Shares below market
price or realize value from the sale of Rights
- Enhanced liquidity: the Offer creates the potential for
increased trading volume and liquidity of Shares
- Lower expense ratio: the Offer is expected to spread
fixed operating costs across a larger asset base
The Fund expects to maintain its current distribution level
following the Offer. Additionally, the Fund declared a regular
monthly distribution payable on September 30, 2022, with a record
date of September 15, 2022, and a regular monthly distribution
payable on October 31, 2022, with a record date of October 5, 2022,
neither of which will be payable with respect to Shares that are
issued pursuant to the Offer as such issuance will occur after
these record dates. Shares issued pursuant to the Offer will be
entitled to receive the monthly distribution expected to be payable
in November.
1Bloomberg US High Yield 2% Issuer Cap Total Return Index
Certain key terms of the Offer include:
- Holders of Shares on the Record Date ("Record Date
Shareholders") will receive one Right for each outstanding Share
owned on the Record Date. The Rights entitle the holders to
purchase one new Share for every 5 Rights held (1-for-5); however,
any Record Date Shareholder who owns fewer than five Shares as of
the Record Date will be entitled to subscribe for one Share.
Fractional Shares will not be issued upon the exercise of
Rights.
- The subscription price per Share (the "Subscription Price")
will be determined on the expiration date of the Offer, which is
currently expected to be October 13, 2022, unless extended by the
Fund (the "Expiration Date"), and will be equal to 95% of the
average of the last reported sales price per Share on the New York
Stock Exchange (the "NYSE") on the Expiration Date and each of the
four (4) immediately preceding trading days, provided that, if such
price is equal to or above net asset value (“NAV”) per Common Share
at the close of trading on the NYSE on the Expiration Date, the
Subscription Price shall be reduced to $0.01 below NAV per Common
Share at the close of trading on the NYSE on the Expiration Date
(the "Formula Price"). If, however, the Formula Price is less than
90% of the Fund's NAV per Share at the close of trading on the NYSE
on the Expiration Date, the Subscription Price will be 90% of the
Fund's NAV per Share at the close of trading on the NYSE on the
Expiration Date. The Subscription Price will be determined by the
Fund on the Expiration Date.
- Record Date Shareholders who fully exercise all Rights issued
to them can subscribe, subject to certain limitations and
allotment, for any additional Shares which were not subscribed for
by other holders of Rights at the Subscription Price, subject to
the right of the Board to eliminate this over-subscription
privilege. Investors who are not Record Date Shareholders but who
otherwise acquire Rights in the secondary market are not entitled
to participate in the over-subscription privilege. If sufficient
Shares are available, all Record Date Shareholders'
over-subscription requests will be honored in full. If these
requests exceed available Shares, they will be allocated pro rata
among those fully exercising Record Date Shareholders who
over-subscribe based on the number of Rights originally issued to
them by the Fund.
- Rights are transferable and are expected to be admitted for
trading on the NYSE under the symbol "HYT RT" during the course of
the Offer and will cease trading one day before the Offer’s
Expiration Date (September 20, 2022 through October 12, 2022).
During this time, Record Date Shareholders may also choose to sell
their Rights.
The Offer will be made only by means of a prospectus supplement
and accompanying prospectus. The Fund expects to mail subscription
certificates evidencing the Rights and a copy of the prospectus
supplement and accompanying prospectus for the Offer to Record Date
Shareholders within the United States shortly following the Record
Date. To exercise their Rights, shareholders who hold their Shares
through a broker, custodian or trust company should contact such
entity to forward their instructions to either exercise or sell
their Rights on their behalf. Shareholders who do not hold Shares
through a broker, custodian, or trust company should forward their
instructions to either exercise or sell their Rights by completing
the subscription certificate and delivering it to the subscription
agent for the Offer, together with their payment, at one of the
locations indicated on the subscription certificate or in the
prospectus supplement.
The information in this press release is not complete and is
subject to change. 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. Investors should consider the Fund's investment
objectives, risks, charges and expenses carefully before investing.
The Fund's prospectus supplement and accompanying prospectus will
contain this and additional information about the Fund and
additional information about the Offer, and should be read
carefully before investing. For further information regarding the
Offer, or to obtain a prospectus supplement and the accompanying
prospectus, when available, please contact the Fund's information
agent:
Georgeson LLC 1290 Avenue of the Americas, 9th Floor New York,
NY 10104 888-497-9677
The Fund’s at-the-market offering of Shares, including the
distribution and sub-placement agent agreements related thereto,
will be suspended during the course of the Offer.
About BlackRock
BlackRock’s purpose is to help more and more people experience
financial well-being. As a fiduciary to investors and a leading
provider of financial technology, we help millions of people build
savings that serve them throughout their lives by making investing
easier and more affordable. For additional information on
BlackRock, please visit www.blackrock.com | Twitter: @blackrock |
Blog: www.blackrockblog.com | LinkedIn:
www.linkedin.com/company/blackrock
Availability of Fund Updates
BlackRock will update performance and certain other data for the
Fund on a monthly basis on its website in the “Closed-end Funds”
section of www.blackrock.com as well as certain other material
information as necessary from time to time. Investors and others
are advised to check the website for updated performance
information and the release of other material information about the
Fund. This reference to BlackRock’s website is intended to allow
investors public access to information regarding the Fund and does
not, and is not intended to, incorporate BlackRock’s website in
this release.
Forward-Looking Statements
This press release, and other statements that BlackRock or the
Fund may make, may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act, with
respect to the Fund’s or BlackRock’s future financial or business
performance, strategies or expectations. Forward-looking statements
are typically identified by words or phrases such as “trend,”
“potential,” “opportunity,” “pipeline,” “believe,” “comfortable,”
“expect,” “anticipate,” “current,” “intention,” “estimate,”
“position,” “assume,” “outlook,” “continue,” “remain,” “maintain,”
“sustain,” “seek,” “achieve,” and similar expressions, or future or
conditional verbs such as “will,” “would,” “should,” “could,” “may”
or similar expressions.
BlackRock cautions that forward-looking statements are subject
to numerous assumptions, risks and uncertainties, which change over
time. Forward-looking statements speak only as of the date they are
made, and BlackRock assumes no duty to and does not undertake to
update forward-looking statements. Actual results could differ
materially from those anticipated in forward-looking statements and
future results could differ materially from historical
performance.
With respect to the Fund, the following factors, among others,
could cause actual events to differ materially from forward-looking
statements or historical performance: (1) 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 Fund or in
the Fund’s net asset value; (2) the relative and absolute
investment performance of the Fund and its investments; (3) the
impact of increased competition; (4) the unfavorable resolution of
any legal proceedings; (5) the extent and timing of any
distributions or share repurchases; (6) the impact, extent and
timing of technological changes; (7) the impact of legislative and
regulatory actions and reforms and regulatory, supervisory or
enforcement actions of government agencies relating to the Fund or
BlackRock, as applicable; (8) 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; (9) BlackRock’s ability to attract and retain highly
talented professionals; (10) the impact of BlackRock electing to
provide support to its products from time to time; and (11) the
impact of problems at other financial institutions or the failure
or negative performance of products at other financial
institutions.
Annual and Semi-Annual Reports and other regulatory filings of
the Fund with the SEC are accessible on the SEC's website at
www.sec.gov and on BlackRock’s website at
www.blackrock.com, and may discuss these or other factors
that affect the Fund. The information contained on BlackRock’s
website is not a part of this press release.
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