DNP Select Income Fund Inc. Will Redeem Mandatory Redeemable Preferred Shares Series B and Series D

Rhea-AI Summary

DNP Select Income Fund (NYSE: DNP) will redeem its Floating Rate Mandatory Redeemable Preferred Shares on April 1, 2021. This includes the redemption of 600 Series B MRP Shares valued at $60 million and 330 Series D MRP Shares worth $33 million, both at 100% of their liquidation preference. The total redemption will be financed by a $93 million borrowing from the Fund's existing credit facility. These shares will not incur accrued and unpaid dividends as they are redeemed on their final payment date.

Positive

• Redemption of 600 Series B MRP Shares for $60 million and 330 Series D MRP Shares for $33 million shows active management of share structure.

Negative

• Funding of $93 million through borrowing may increase financial leverage and associated risks.

CHICAGO, March 31, 2021 /PRNewswire/ -- DNP Select Income Fund Inc. (NYSE: DNP), a closed-end fund advised by Duff & Phelps Investment Management Co., announced today that the Fund will redeem two series of its Floating Rate Mandatory Redeemable Preferred Shares, liquidation preference $100,000 per share ("MRP Shares"), on their mandatory redemption date of April 1, 2021.

The Fund will redeem all 600 of the outstanding Series B MRP Shares (CUSIP 23325P3#9) for an aggregate price of $60 million and all 330 of the outstanding Series D MRP Shares (CUSIP 23325P5#7) for an aggregate price of $33 million.  The Series B and Series D MRP Shares will be redeemed for 100% of their liquidation preference. There are no accrued and unpaid dividends because the redemptions are occurring on the final dividend payment date.

The redemption of the Series B and Series D MRP Shares is being funded by the borrowing of $93 million under the Fund's existing credit facility with a major commercial bank.       

About the Fund

DNP Select Income Fund Inc. is a closed-end diversified investment management company whose primary investment objectives are current income and long-term growth of income. The fund seeks to achieve these objectives by investing primarily in a diversified portfolio of equity and fixed income securities of companies in the public utilities industry. For more information, please visit www.dpimc.com/dnp or call (800) 864-0629.

About the Investment Adviser

Duff & Phelps Investment Management Co. has more than 40 years of experience managing investment portfolios, including institutional separate accounts and open- and closed-end funds investing in utilities, infrastructure and real estate investment trusts (REITs).  For more information, visit www.dpimc.com.

Duff & Phelps is a subsidiary of Virtus Investment Partners (NASDAQ: VRTS), a multi-boutique asset manager with approximately $166.6 billion under management as of February 28, 2021.  Virtus provides investment management products and services to individuals and institutions through a multi-manager asset management business, comprising a number of individual affiliated managers, each with a distinct investment style, autonomous investment process and individual brand.  Additional information can be found at www.virtus.com.

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SOURCE DNP Select Income Fund Inc.

FAQ

What is the redemption date for DNP Select Income Fund MRP Shares?

The redemption date for the MRP Shares is April 1, 2021.

How much will DNP redeem for Series B and Series D MRP Shares?

DNP will redeem $60 million for Series B and $33 million for Series D MRP Shares.

How is DNP funding the redemption of MRP Shares?

The redemption is being funded by a $93 million borrowing under its existing credit facility.

Will there be any accrued dividends with the redemption of MRP Shares by DNP?

No, there are no accrued and unpaid dividends as the redemptions occur on the final dividend payment date.