PHILADELPHIA, Oct. 14 PA-Delaware-Funds
PHILADELPHIA, Oct. 14 /PRNewswire-FirstCall/ -- The Board of Directors of
Delaware Investments Colorado Municipal Income Fund, Inc. (ASE: VCF) and
Delaware Investments Minnesota Municipal Income Fund II, Inc. (ASE: VMM)
(each, a "Fund," and collectively, the "Funds") announced it has approved a
plan to redeem all or a significant portion of outstanding preferred shares
issued by the Funds. The first redemption is scheduled for October 22, 2008.
Each of the Funds has two or more series of preferred shares issued, each
with a liquidation preference of $50,000 plus any accrued and undistributed
capital gains through the dividend payable date. The redemption plan is
intended to better position each Fund to pursue its investment objectives in
light of current and unprecedented market volatility, which has resulted in
higher short-term interest rates. Preferred Shareholders of each series of
the Funds listed in the table below are subject to redemption on the dates and
in the amounts listed. The implementation of the redemption plan, including
the amounts and the frequency with which Management may seek to redeem shares,
remains subject to market conditions as well as the discretion of the Funds'
investment managers.
Number of Number of
Preferred Preferred
Shares Shares
Outstanding Redemptionto be
Fund Name Series CUSIPCurrently Date Redeemed
Delaware Investments
Colorado Municipal Income
Fund, Inc (ASE: VCF) A 246101208 400 Oct. 22, 2008 270
B 246101307 400 Oct. 22, 2008 270
Delaware Investments
Minnesota Municipal Income
Fund II, Inc (ASE: VMM) B 24610V304 600 Oct. 22, 2008 355
Management recommended the redemption of the Funds' preferred shares based
on its expectation that the current environment may become increasingly
difficult for the Funds to invest the assets attributable to the preferred
shares in securities that provide a sufficient rate of return compared to the
dividend rates payable on the preferred shares, which have remained elevated
in recent remarketings. These higher costs, in conjunction with current
market conditions, could cause the Funds to realize an overall lower rate of
return than if the Funds were not leveraged. The Funds' Board of Directors may
consider adding some form of leverage to the Funds in the future if warranted
by economic conditions at that time.
Under the Statements Fixing the Rights and Preferences of each Fund's
preferred shares, Depository Trust Company (DTC), the securities' holder of
record, determines by lot how partial series redemptions will be allocated
among each participant broker-dealer account. DTC then notifies Deutsche Bank
Trust Company Americas (DBTCA), the Funds' paying agent, of its determination
and DBTCA determines by lot the number of shares to be redeemed from preferred
shareholder accounts held by each participant broker-dealer. DBTCA may
determine that shares will be redeemed from the accounts of some preferred
shareholders, which may include the Funds' remarketing agents, without shares
being redeemed from the accounts of other preferred shareholders.
About Delaware Investments:
Delaware Investments, an affiliate of Lincoln Financial Group, is a
Philadelphia-based diversified asset management firm with more than $135
billion in assets under management as of June 30, 2008. Through a broad range
of managed accounts and portfolios, mutual funds, retirement accounts, sub-
advised funds and other investment products, Delaware Investments provides
investment services to individual investors and to institutional investors
such as private and public pension funds, foundations, and endowment funds.
Delaware Investments is the marketing name for Delaware Management Holdings,
Inc. and its subsidiaries. For more information on Delaware Investments, visit
the company at http://www.delawareinvestments.com. Lincoln Financial Group is
the marketing name for Lincoln National Corporation (NYSE: LNC) and its
affiliates. For more information on Lincoln Financial Group, visit
http://www.lincolnfinancial.com.
SOURCE Delaware Investments
