NXG NextGen Infrastructure Income Fund (NYSE: NXG) Announces the Preliminary Results of its Rights Offering

Rhea-AI Summary

The NXG NextGen Infrastructure Income Fund (NYSE: NXG) has announced the preliminary results of its transferable rights offering, which concluded on July 17, 2024. The offer, which began on June 20, 2024, allowed rights holders to subscribe for up to 867,238 common shares at a price of $37.25 per share. This price was set at 86% of the Fund's net asset value per share at the close of trading on the expiration date.

The offering was oversubscribed, indicating strong investor interest. The Fund expects to raise approximately $32,000,000 in gross proceeds, which it plans to invest in line with its investment objective and policies. Common shares will be issued after the completion of shareholder payments and the pro-rata allocation of shares for the over-subscription privilege.

Positive

• Oversubscribed rights offering indicates strong investor demand
• Expected gross proceeds of approximately $32,000,000
• Subscription price set at a 14% discount to NAV, potentially attractive for investors

Negative

• Potential dilution for existing shareholders who did not fully participate in the offering

Insights

Financial Analyst

Navigating the results of NXG's rights offering reveals significant insights for retail investors. The Fund announced the preliminary results of its transferable rights offering, which was oversubscribed, highlighting strong investor interest and confidence in the Fund's strategy. The offerings were priced at $37.25 per Common Share, set at 86% of the Fund's net asset value (NAV) per share, indicating a compelling discount designed to encourage participation.

Moreover, the gross proceeds from the offering are projected to be approximately $32,000,000. This infusion is expected to be reinvested in line with the Fund’s investment objectives, potentially enhancing the diversified infrastructure portfolio. However, it is essential to consider the impact of the new shares on existing shareholders. While the oversubscription demonstrates demand, the issuance of new shares can dilute existing holdings, impacting per-share metrics like earnings and dividends.

Short-term, investors might see an adjustment period as the market absorbs the additional shares. Long-term, the raised capital, if invested wisely, can contribute to the Fund's growth and long-term returns. Investors should monitor how effectively the Fund allocates these proceeds and the subsequent performance of the investments made.

DALLAS, July 18, 2024 /PRNewswire/ -- The NXG NextGen Infrastructure Income Fund (NYSE: NXG) (the "Fund") announced the preliminary results of its transferable rights offering (the "Offer"). The Offer commenced on June 20, 2024, and expired on July 17, 2024 (the "Expiration Date"). The Offer entitled rights holders to subscribe for up to an aggregate of 867,238 of the Fund's common shares of beneficial interest, par value $0.001 per share ("Common Shares"). The subscription price was $37.25 per Common Share and was determined based upon a formula equal to 86% of the Fund's net asset value per Common Share at the close of trading on the New York Stock Exchange on the Expiration Date. The Offer was oversubscribed. Common Shares will be issued promptly after completion and receipt of all shareholder payments and the pro-rata allocation of Common Shares in respect of the over­ subscription privilege.

Gross proceeds of the Offer are expected to be approximately $32,000,000. The Fund intends to invest the net proceeds of the Offer in accordance with its investment objective and policies.

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. Such information, including other information about the Fund, can be found on file with the Securities and Exchange Commission and should be read carefully before investing.

About NXG Investment Management

The Investment Adviser is an SEC-registered investment adviser headquartered in Dallas, Texas. Cushing serves as investment adviser to affiliated funds and managed accounts. Cushing Asset Management, LP is doing business as NXG Investment Management, providing Next Generation investment strategies to investors seeking long-term growth in companies focused on a clean and sustainable future as well as traditional and transformational infrastructure companies.

About NXG NextGen Infrastructure Income Fund

The Fund is a closed-end management investment company with an investment objective of seeking a high total return with an emphasis on current income. The Fund seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its net assets, plus any borrowings for investment purposes, in a portfolio of equity and debt securities of infrastructure companies, including: (i) energy infrastructure companies, (ii) industrial infrastructure companies, (iii) sustainable infrastructure companies, and (iv) technology and communication infrastructure companies. The Fund will invest no more than 25% of its Managed Assets in securities of energy master limited partnerships ("MLPs") that qualify as publicly traded partnerships under the Internal Revenue Code. The Fund's shares are traded on the New York Stock Exchange under the symbol "NXG."

There can be no assurance that the Fund will achieve its investment objectives. Investments in the Fund involve operating expenses and fees. The net asset value of the Fund will fluctuate with the value of the underlying securities. It is important to note that closed-end funds trade on their market value, not net asset value, and closed-end funds often trade at a discount to their net asset value.

The Fund utilizes leverage as part of its investment strategy. There can be no assurance that the Fund will achieve its investment objectives.

For information about the Fund, please contact your financial advisor.

Contact:

Blake Nelson
NXG Investment Management
214-692-6334
www.nxgim.com

NOT FDIC INSURED

NO BANK GUARANTEE

MAY LOSE VALUE

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SOURCE NXG Investment Management

FAQ

What were the key details of NXG NextGen Infrastructure Income Fund's rights offering?

NXG's rights offering allowed subscription for up to 867,238 common shares at $37.25 per share, which was 86% of the Fund's NAV at the expiration date. The offering ran from June 20 to July 17, 2024, and was oversubscribed.

How much did NXG NextGen Infrastructure Income Fund (NYSE: NXG) raise in its rights offering?

NXG NextGen Infrastructure Income Fund expects to raise approximately $32,000,000 in gross proceeds from its oversubscribed rights offering.

When will NXG (NYSE: NXG) issue the new common shares from the rights offering?

NXG will issue the new common shares promptly after completing and receiving all shareholder payments and conducting the pro-rata allocation for the over-subscription privilege.

How does NXG plan to use the proceeds from its July 2024 rights offering?

NXG NextGen Infrastructure Income Fund intends to invest the net proceeds from the rights offering in accordance with its investment objective and policies.