The Board of Each of Dreyfus Strategic Municipals, Inc. And Dreyfus Strategic Municipal Bond Fund, Inc. Authorizes the Use of Tender Option Bonds in Connection with Any Additional Partial Redemption of Its Auction Rate Preferred Stock
On Monday, February 11, 2013, the Board of Directors of each of Dreyfus Strategic Municipals, Inc. (NYSE: LEO) and Dreyfus Strategic Municipal Bond Fund, Inc. (NYSE: DSM) authorized each Fund to redeem up to an additional 25 percent of its original amount of outstanding auction rate preferred stock (“ARPS”), subject to market, regulatory and other conditions and factors. It is currently anticipated that, upon redemption, the leverage provided by the ARPS would be replaced through the creation of tender option bonds (“TOBs”). The timing and amount for such redemptions and refinancing of the ARPS could occur within approximately a 12-month period, but will be determined by the availability of acceptable terms on the TOBs, market, regulatory and other factors, and Fund management is not certain when, or if, such amount will be redeemed and refinanced. Before any such redemption of the ARPS, each Fund would issue a notice containing specific details regarding the redemption, which would include a press release that also would be placed on the Dreyfus website.
The ability of each Fund to utilize TOBs is based, in part, on the eligibility of its underlying municipal bonds for TOB programs. The extent to which each Fund is able to use TOBs to redeem ARPS depends on market conditions, the Fund's portfolio composition, the cost of liquidity and the willingness of liquidity providers to support TOBs, among other factors. The TOB structure is less permanent than ARPS since TOBs may be unwound upon the occurrence of certain events, such as a failed remarketing of the TOB securities, and there is no certainty that TOB financing will be available in the future.
In November 2009, each Fund's Board authorized an initial redemption of up to 25 percent of the its then-outstanding ARPS, subject to market, regulatory, timing and other conditions and factors. Each Fund subsequently redeemed that amount of ARPS in stages and the leverage provided by the redeemed ARPS was replaced through the creation of TOBs.
Additional information relating to this matter can be accessed at http://www.dreyfus.com/ars.
This press release is published solely for informational purposes and is not to be construes as specific tax, legal or investment advice. Nor is this document intended as a solicitation or an offer to buy or sell securities or related financial instruments. The release should not be regarded by recipients as a substitute for exercise of their own judgment. Statements made in this release are based on current market conditions. Different market conditions and assumptions could have materially different results. Neither Dreyfus, the Funds nor any of their affiliates, directors, employees or agents accept any liability for any loss or damage arising out of the use of all or any part of this release.
Certain statements contained in this release may be forward-looking in nature. Such statements represent current beliefs, based on information available at the time the statements are made, with regard to matters addressed. Actual future occurrences may differ significantly from those anticipated in any forward-looking statements due to numerous factors. These include, but are not limited to, those noted above, and other additional risks and uncertainties. The Funds, Dreyfus and any of their affiliates, directors, employees or agents undertake no responsibility to update publicly or revise any forward-looking statements.
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