By Stephanie N. Rotondo
Portland, Ore., May 4 - Nuveen Select Quality Municipal Fund, Inc. wrapped a $252.5 million issue of variable-rate demand preferred shares, according to a press release.
Dividends on the new preferreds will be set weekly at a rate established by Barclays Capital Inc. as remarketing agent. The dividend is subject to a maximum rate that will increase over time in the event of an extended period of unsuccessful remarketing.
The preferreds have a liquidity feature that allows shareholders to sell their holdings to a liquidity provider - in this case, Barclays Bank plc - in the event that sell orders are not matched with purchase orders and settled in a remarketing.
The feature also requires the fund to redeem the preferreds owned by the liquidity provider if a remarketing is unsuccessful after six months.
Proceeds will be used to redeem at par all of the fund's outstanding auction-rate preferred shares. The refinancing is expected to lower the relative costs of leverage for the fund over time while also providing liquidity at par for holders of the auction-rate preferreds.
The fund is managed by Chicago-based Nuveen Investments LLC.
| Issuer: | Nuveen Select Quality Municipal Fund, Inc.
|
| Securities: | Variable-rate demand preferred shares
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| Amount: | $252.5 million
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| Dividends: | Weekly rate
|
| Remarketing agent: | Barclays Capital Inc.
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| Liquidity provider: | Barclays Bank plc
|
| Distribution: | Rule 144A offering
|
| Pricing date: | May 4
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