Nuveen Preferred and Income Term Fund Announces Preliminary Results of Tender Offer

Rhea-AI Summary

Nuveen Preferred and Income Term Fund (NYSE: JPI) announced preliminary results of its tender offer, which expired on August 14, 2024. Approximately 37% of outstanding common shares (8,511,627 shares) were tendered. The offer allowed shareholders to repurchase up to 100% of their shares at 100% of the net asset value per share. The completion is subject to maintaining a minimum of $70 million in aggregate net assets after the tender.

If conditions are met, JPI plans to eliminate its term structure and change its name to 'Nuveen Preferred Securities & Income Opportunities Fund' on August 19, 2024. Nuveen will waive 50% of its net management fees for the first year following this change. The fund will continue trading on NYSE under the same ticker symbol.

Positive

• Tender offer allows shareholders to repurchase shares at 100% of net asset value
• 37% of outstanding common shares were tendered, indicating significant shareholder interest
• Planned elimination of term structure may provide more flexibility for the fund
• Nuveen to waive 50% of net management fees for the first year after restructuring

Negative

• Tender offer completion is conditional on maintaining $70 million in aggregate net assets
• If conditions are not met, the fund will proceed to terminate on its scheduled date
• Significant share repurchase may reduce the fund's total assets under management

Insights

Financial Analyst

The tender offer results for Nuveen Preferred and Income Term Fund (JPI) reveal significant shareholder interest, with 37% of outstanding shares tendered. This substantial participation suggests investors' desire for liquidity or potential dissatisfaction with the fund's performance. The $70 million minimum net asset threshold is crucial; if met, it signals sufficient investor confidence to continue operations. The planned transition to an open-end structure and 50% management fee waiver for the first year are positive moves to enhance shareholder value. However, the high tender rate might indicate underlying concerns about the fund's strategy or market positioning. Investors should closely monitor the final results and subsequent performance to assess the fund's long-term viability in its new structure.

Market Research Analyst

The preliminary results of JPI's tender offer provide valuable insights into investor sentiment in the preferred securities market. The 37% tender rate is significant, potentially reflecting broader market trends such as rising interest rates or shifting preferences in fixed-income investments. This move by Nuveen, a major player with $54 billion in CEF assets, could influence industry practices. The transition from a term structure to an open-end fund might set a precedent for other term funds facing similar challenges. The fee waiver is a strategic move to retain investors, but its effectiveness remains to be seen. This event underscores the importance of fund structure and fee considerations in the current market environment, where investors are increasingly sensitive to costs and liquidity options.

NEW YORK--(BUSINESS WIRE)-- Nuveen Preferred and Income Term Fund (NYSE: JPI) announced the preliminary results of a tender offer.

As previously announced, the fund conducted a tender offer allowing shareholders to offer up to 100% of their common shares for repurchase for cash at a price per share equal to 100% of the net asset value per share as of the close of ordinary trading on the New York Stock Exchange on the expiration date of the tender offer. The tender offer expired on August 14, 2024 at 5:00 p.m. Eastern time.

Based on preliminary information, 8,511,627 common shares were tendered, representing approximately 37% of the fund’s common shares outstanding. These figures do not include shares tendered through notice of guaranteed delivery.

The completion of the fund’s tender offer is subject to certain conditions, including that the aggregate net assets of the fund attributable to common shares must equal or exceed $70 million as of the expiration date of the tender offer, taking into account the amounts that would be paid to shareholders who have properly tendered their shares. If the fund’s aggregate net assets attributable to common shares after taking into account shares properly tendered would be less than $70 million, the tender offer will not be completed, no common shares will be repurchased, and the fund will proceed terminate on its scheduled termination date.

The fund currently anticipates the satisfaction of all tender offer conditions and a successful completion of the tender offer and expects to announce the final results of the offer on August 19, 2024. Accordingly, the fund intends to implement the proposal described in the fund’s proxy statement dated February 26, 2024 and in the offer to purchase relating to the tender offer. In particular, anticipated to be effective on August 19, 2024, JPI’s term structure will be eliminated and the fund’s name will change to “Nuveen Preferred Securities & Income Opportunities Fund.” The common shares of the fund will continue to trade on the New York Stock Exchange under the current ticker symbol. In addition, Nuveen will waive 50% of its net management fees over the first year following the elimination of the term.

Nuveen is a leading sponsor of closed-end funds (CEFs) with $54 billion of assets under management across 45 CEFs as of 30 June 2024. The funds offer exposure to a broad range of asset classes and are designed for income-focused investors seeking regular distributions. Nuveen has more than 35 years of experience managing CEFs.

About Nuveen

Nuveen, the investment manager of TIAA, offers a comprehensive range of outcome-focused investment solutions designed to secure the long-term financial goals of institutional and individual investors. Nuveen has $1.2 trillion in assets under management as of 30 June 2024 and operations in 27 countries. Its investment specialists offer deep expertise across a comprehensive range of traditional and alternative investments through a wide array of vehicles and customized strategies. For more information, please visit www.nuveen.com.

Nuveen Securities, LLC, member FINRA and SIPC.

The information contained on the Nuveen website is not a part of this press release.

Certain statements made in this release are forward-looking statements. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements due to numerous factors. These include, but are not limited to:

• market developments;
• legal and regulatory developments;
• the satisfaction of conditions for completing the tender offer; and
• other additional risks and uncertainties.

You should not place undue reliance on forward-looking statements, which speak only as of the date they are made. Nuveen and the closed-end funds managed by Nuveen and its affiliates undertake no responsibility to update publicly or revise any forward-looking statements.

The annual and semi-annual reports and other regulatory filings of Nuveen closed-end funds with the Securities and Exchange Commission (“SEC”) are accessible on the SEC’s web site at www.sec.gov and on Nuveen’s web site at www.nuveen.com/cef and may discuss the above-mentioned or other factors that affect Nuveen closed-end funds.

EPS-3788971CR-E0824W

View source version on businesswire.com: https://www.businesswire.com/news/home/20240815673987/en/

For more information, please visit Nuveen’s CEF homepage www.nuveen.com/closed-end-funds or contact:

Financial Professionals:

800-752-8700

Investors:

800-257-8787

Media:

media-inquiries@nuveen.com

Source: Nuveen

FAQ

What were the preliminary results of JPI's tender offer?

Based on preliminary information, 8,511,627 common shares, representing approximately 37% of JPI's outstanding common shares, were tendered in the offer that expired on August 14, 2024.

What conditions must be met for JPI's tender offer to be completed?

The fund's aggregate net assets attributable to common shares must equal or exceed $70 million after taking into account the shares properly tendered in the offer.

What changes are planned for JPI if the tender offer is successful?

If successful, JPI plans to eliminate its term structure, change its name to 'Nuveen Preferred Securities & Income Opportunities Fund', and Nuveen will waive 50% of its net management fees for the first year following the change, effective August 19, 2024.

Will JPI's ticker symbol change after the restructuring?

No, JPI will continue to trade on the New York Stock Exchange under its current ticker symbol even after the planned changes.