BlackRock amends five term trusts to allow further partial redemptions

By Toni Weeks

San Luis Obispo, Calif., Nov. 7 - BlackRock has amended the statement of preferences for each of five term trusts with outstanding auction-rate preferred shares to allow partial redemptions, according to a press release.

The closed-end funds include the BlackRock Municipal 2018 Term Trust (Symbol: BPK), the BlackRock California Municipal 2018 Term Trust (Symbol: BJZ), the BlackRock New York Municipal 2018 Term Trust (Symbol: BLH), the BlackRock Municipal 2020 Term Trust (Symbol: BKK) and the BlackRock Florida Municipal 2020 Term Trust (Symbol: BFO).

The amendment eliminates a requirement that precluded partial redemptions of auction-rate preferreds once the number of auction-rate preferreds outstanding falls below 300 for a particular trust. The boards said that removing this obstacle will provide additional flexibility to shareholders, as partial redemptions could be conducted in advance of a term trust's maturity.

Each term trust has a maturity date that defines when it will liquidate and distribute assets. Each seeks to provide current income exempt from regular federal income tax, and state income tax, if applicable, and return the trust's initial public offering price of $15.00 per common share on the maturity date. Each fund matures on Dec. 31 of its respective term year.

As announced Feb. 12, 2013, BlackRock currently intends to provide liquidity to auction-rate preferreds holders from time to time over the remaining term of each trust. The amount and timing of any such liquidity events will differ for each term trust. Since February 2008, each term trust has conducted partial redemptions of their outstanding auction-rate preferreds that total, in aggregate, $225.8 million. This amount includes $14.65 million of redemptions announced Thursday for BFO, BKK and BPK.

BlackRock said it continues to actively evaluate options to provide liquidity to auction-rate preferreds holders.

New York-based BlackRock is an investment management firm.

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