DWS municipal funds extend tender offers for preferreds till Friday

By Susanna Moon

Chicago, Nov. 13 - DWS Municipal Income Trust (KTF) and DWS Strategic Municipal Income Trust (KSM) again extended the tender offers for their respective outstanding preferred shares, this time by a week to 5 p.m. ET on Nov. 16.

The funds again cited disruptions caused by Hurricane Sandy and added the need for more time to finalize refinancing transactions, according to a press release.

As previously noted, each fund's tender offer is conditioned on the completion of refinancing with enough proceeds to fund the offer.

The offers were extended from 5 p.m. ET on Nov. 9 and, before that, from 5 p.m. ET on Nov. 2.

As of Nov. 9, holders had tendered 95.03% of KTF's outstanding remarketed preferred shares and 86.4% of KSM's outstanding auction-rate preferreds. As of Nov. 1, holders had tendered 97.1% of KTF's outstanding remarketed preferred shares and 86.4% of KSM's outstanding auction-rate preferreds. As of Oct. 26, investors had tendered 94.99% of KTF's outstanding remarketed preferred shares and 86.39% of KSM's outstanding auction-rate preferreds.

Before the problems from the hurricane, the funds had extended the offers to provide holders more time to participate in the offer. "There can be no guarantee that there will be future liquidity for the funds' preferred shares," according to a previous release.

The offers began on Sept. 27 and were originally set to end on Oct. 26.

As noted before, KTF is offering to purchase its outstanding remarketed preferred shares at a price equal to 96% of the preferreds' per share liquidation preference of $5,000, or $4,800 per remarketed preferred, plus any unpaid dividends accrued through the tender offer expiration date.

KSM is offering to purchase its outstanding auction-rate preferred shares at a price equal to 96% of the auction-rate preferreds' per share liquidation preference of $25,000, or $24,000 per auction-rate preferred, plus any unpaid dividends accrued through the tender offer expiration date.

KTF's tender offer is also conditioned upon receiving tenders for at least 90% of its outstanding remarketed preferred shares. KSM's offer is conditioned on receiving tenders for at least 70% of its outstanding auction-rate preferreds.

Deutsche Bank Trust Co. Americas (800 735-7777) is the information agent for the offers.

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