Reaves Utility Income Fund Announces Rights Offering
06/27/2012| 04:35pm US/Eastern
The Board of Trustees of Reaves Utility Income Fund (NYSE MKT: UTG) has
authorized and set the terms of an offering to the Fund's shareholders
of rights to purchase additional common shares of the Fund.
The Fund is issuing transferable subscription rights ("Rights") to its
common shareholders of record as of July 9, 2012 (the "Record Date" and
such shareholders, "Record Date Shareholders") who will be allowed to
subscribe for new common shares of the Fund (the "Primary
Subscription"). Record Date Shareholders will receive one Right for each
common share held on the Record Date. For every three Rights held, a
holder of Rights may buy one new common share of the Fund.
Record Date Shareholders who fully exercise all Rights initially issued
to them in the Primary Subscription will be entitled to buy those common
shares that are not purchased by other Record Date Shareholders. In
addition, the Fund, in its sole discretion, may elect to issue
additional common shares in an amount of up to 25% of the common shares
issued in the Primary Subscription.
The subscription price per common share will be determined based upon a
formula equal to 95% of the reported net asset value or market price per
common share, whichever is lower on the Expiration Date (as defined
below). Market price per common share will be determined based on the
average of the last reported sales price of a common share on the NYSE
MKT for the five trading days preceding the Expiration Date.
The rights offering is subject to the effectiveness of the Fund's
Registration Statement currently on file with the Securities and
Exchange Commission (the "SEC") and will be made only by means of a
prospectus. The Fund anticipates that the offering will expire on or
about August 8, 2012 (the "Expiration Date").
A final Registration Statement relating to the securities has not been
made with the SEC as of the date of this release. These securities may
not be sold nor may offers to purchase be accepted prior to the time the
Registration Statement becomes effective with the SEC.
This press release shall not constitute an offer to sell or constitute a
solicitation of an offer to buy. Investors should read the prospectus,
when available, and consider the investment objective, risks, fees and
expenses of the Fund carefully before investing.
The Reaves Utility Income Fund
The investment objective of the Fund is to provide a high level of
income and total return consisting primarily of tax-advantaged dividend
income and capital appreciation. There were approximately $817 million
of total assets under management and 23.1 million common shares
outstanding as of June 26, 2012.
An investor should consider investment objectives, risks, charges and
expenses carefully before investing. To obtain a prospectus, annual
report or semi-annual report which contains this and other information,
or call 1-800-644-5571. Read them carefully before investing.
The Reaves Utility Income Fund is a closed-end fund and closed-end
funds do not continuously issue shares for sale as open-end mutual funds
do. Since the initial public offering, the Fund now trades in the
secondary market. Investors wishing to buy or sell shares need to
place orders through an intermediary or broker. The share price of a
closed-end fund is based on the market's value.
Reaves Utility Income Fund
Ned Burke, 303-623-2577
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