Kayne Anderson Energy Infrastructure Fund Announces Change to Monthly Distributions and Announces Distributions

Rhea-AI Summary

Kayne Anderson Energy Infrastructure Fund (NYSE: KYN) announced a change in its distribution payment frequency from quarterly to monthly, starting November 2024. The company declared monthly distributions of $0.08 per share for November 2024, December 2024, and January 2025, equivalent to the previous quarterly distribution of $0.24 per share.

KYN's Board of Directors believes this change will make the fund more attractive to investors seeking more frequent payments. The company intends to continue declaring monthly distributions, subject to Board approval. Estimated return of capital for these distributions ranges from 0% to 75%, with final tax characterization to be determined after the end of the respective fiscal years.

KYN is a closed-end management investment company focused on providing high after-tax returns through investments in Energy Infrastructure Companies.

Positive

• Change from quarterly to monthly distribution payments, potentially attracting more investors
• Maintained equivalent distribution amount ($0.24 per quarter, now $0.08 per month)
• Intention to continue monthly distributions, subject to Board approval

Negative

• High estimated return of capital (up to 75%) for some distributions, which may impact tax efficiency

Insights

Financial Analyst

The change from quarterly to monthly distributions is a significant move for Kayne Anderson Energy Infrastructure Fund (KYN). This shift to more frequent payouts can be attractive to income-focused investors, potentially improving the fund's appeal in the market. The $0.08 monthly distribution maintains the equivalent of the previous $0.24 quarterly payout, indicating stability in the fund's distribution policy.

However, investors should note the high estimated return of capital component (75%-80%) in these distributions. This suggests that a significant portion of the payouts may not be coming from the fund's earnings, which could impact the fund's net asset value over time if not supported by portfolio appreciation or income.

The fund's focus on Energy Infrastructure Companies aligns with current market trends favoring energy investments. This specialized strategy may offer opportunities in a sector experiencing renewed interest, but it also concentrates risk in a single industry.

HOUSTON, Oct. 10, 2024 (GLOBE NEWSWIRE) -- Kayne Anderson Energy Infrastructure Fund, Inc. (the “Company”) announced today its distribution payment frequency will change from quarterly to monthly payments beginning in November 2024.

As outlined in the table below, the Company declared a monthly distribution of $0.08 per share payable in November 2024, December 2024 and January 2025. This monthly distribution amount is equivalent to the $0.24 per share quarterly distribution paid by KYN on October 7, 2024.

The Board of Directors and management understand how important distributions are to the Company’s investors and believe this change to KYN’s distribution policy will make it an attractive choice for investors who desire more frequent distribution payments.

Payment of future distributions is subject to the approval of the Company’s Board of Directors.  It is the Company’s intention to declare monthly payments each month beginning with the monthly distribution payment expected to be made in February 2025.

Record Date / Ex-Date	Payment Date	Distribution Amount	Return of Capital Estimate
11/15/24	11/29/24	$0.08	0%(1)
12/16/24	12/31/24	$0.08	75%(2)
1/15/25	1/31/25	$0.08	75%(2)

(1) This estimate is based on the Company’s anticipated earnings and profits. The final determination of the tax character of distributions will not be determinable until after the end of fiscal 2024 and may differ substantially from this preliminary information.
(2) This estimate is based on the Company’s anticipated earnings and profits. The final determination of the tax character of distributions will not be determinable until after the end of fiscal 2025 and may differ substantially from this preliminary information.

Kayne Anderson Energy Infrastructure Fund, Inc. (NYSE: KYN) is a non-diversified, closed-end management investment company registered under the Investment Company Act of 1940, as amended, whose common stock is traded on the NYSE. The Company’s investment objective is to provide a high after-tax total return with an emphasis on making cash distributions to stockholders. KYN intends to achieve this objective by investing at least 80% of its total assets in securities of Energy Infrastructure Companies. See Glossary of Key Terms in the Company’s most recent quarterly report for a description of these investment categories and the meaning of capitalized terms.

The Company pays cash distributions to common stockholders at a rate that may be adjusted from time to time. Distribution amounts are not guaranteed and may vary depending on a number of factors, including changes in portfolio holdings and market conditions. 

This press release shall not constitute an offer to sell or a solicitation to buy, nor shall there be any sale of any securities in any jurisdiction in which such offer or sale is not permitted. Nothing contained in this press release is intended to recommend any investment policy or investment strategy or consider any investor’s specific objectives or circumstances. Before investing, please consult with your investment, tax, or legal adviser regarding your individual circumstances.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: This communication contains statements reflecting assumptions, expectations, projections, intentions, or beliefs about future events. These and other statements not relating strictly to historical or current facts constitute forward-looking statements as defined under the U.S. federal securities laws. Forward-looking statements involve a variety of risks and uncertainties. These risks include but are not limited to changes in economic and political conditions; regulatory and legal changes; energy industry risk; leverage risk; valuation risk; interest rate risk; tax risk; and other risks discussed in detail in the Company’s filings with the SEC, available at www.kaynefunds.com or www.sec.gov. Actual events could differ materially from these statements or our present expectations or projections. You should not place undue reliance on these forward-looking statements, which speak only as of the date they are made. Kayne Anderson undertakes no obligation to publicly update or revise any forward-looking statements made herein. There is no assurance that the Company’s investment objectives will be attained.

Contact investor relations at 877-657-3863 or cef@kayneanderson.com.

FAQ

What is the new monthly distribution amount for Kayne Anderson Energy Infrastructure Fund (KYN)?

Kayne Anderson Energy Infrastructure Fund (KYN) announced a new monthly distribution of $0.08 per share, payable in November 2024, December 2024, and January 2025.

When will KYN start paying monthly distributions instead of quarterly?

KYN will start paying monthly distributions beginning in November 2024, changing from its previous quarterly distribution schedule.

What is the estimated return of capital for KYN's upcoming distributions?

The estimated return of capital for KYN's distributions varies: 0% for November 2024, and 75% for both December 2024 and January 2025 distributions.

What is Kayne Anderson Energy Infrastructure Fund's (KYN) investment objective?

KYN's investment objective is to provide a high after-tax total return with an emphasis on making cash distributions to stockholders, primarily by investing in Energy Infrastructure Companies.