SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
(Amendment No. 26)
Under the Securities and Exchange Act of 1934
Salomon Brothers Municipal Partners Fund, Inc.
(MNP)
(Name of Issuer)
Common Stock
(Title of Class of Securities)
794916106
(CUSIP Number)
George W. Karpus, President
Karpus Management, Inc. d/b/a
Karpus Investment Management
183 Sullys Trail
Pittsford, New York 14534
(585) 586-4680
(Name, Address, and Telephone Number of Person Authorized to Receive Notices
and Communications)
November 9, 2005
(Date of Event which Requires Filing of this Statement)
If the person has previously filed a statement on Schedule 13G to report the
acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1 (b) (3) or (4), check the following box. [ ]
(Page 1 of 11 pages)
There are Three Exhibits.
ITEM 1 Security and Issuer
Common Stock
Salomon Brothers Municipal Partners Fund, Inc.
Salomon Brothers Asset Management
125 Broad Street
10th Floor, MF-2
New York, New York 10004
ITEM 2 Identity and Background
a) Karpus Management, Inc. d/b/a Karpus Investment Management
(?KIM?)
George W. Karpus, President, Director and Controlling Stockholder
JoAnn VanDegriff, Vice President and Director
Sophie Karpus, Director
b) 183 Sullys Trail
Pittsford, New York 14534
c) Principal business and occupation - Investment Management for
individuals, pension and profit sharing plans, corporations,
endowments, trust and others, specializing in conservative asset
management (i.e. fixed income investments).
d) None of George W. Karpus, JoAnn Van Degriff, or Sophie Karpus
(?the Principals?) or KIM has been convicted in the past five years of
any criminal proceeding (excluding traffic violations).
e) During the last five years none of the principals or KIM has been a party
to a civil proceeding as a result of which any of them is subject to a
judgment, decree or final order enjoining future violations of or
prohibiting or mandating activities subject to, federal or state
securities laws or finding any violation with respect to such laws.
f) Each of the Principals is a United States citizen.
KIM is a New York corporation.
ITEM 3 Source and Amount of Funds or Other Considerations
KIM, an independent investment advisor, has accumulated shares of MNP
on behalf of accounts that are managed by KIM (?the Accounts?) under
limited powers of attorney. All funds that have been utilized in making
such purchases are from such Accounts.
ITEM 4 Purpose of Transaction
a) KIM has purchased Shares for investment purposes. Being primarily a
fixed income manager, with a specialty focus in the closed end fund
sector, the profile of MNP fit the investment guidelines for various
Accounts. Shares have been acquired since December 8, 2000.
b) Although originally purchased for investment purposes only, KIM sent
a proposal to be considered at the next special meeting (Exhibit 1)
c) On October 5, 2005, KIM filed the attached shareholder communication
(Exhibit 2)
ITEM 5 Interest in Securities of the Issuer
a) As of the date of this Report, KIM owns 324,540 shares, which
represents 5.64 % of the outstanding Shares. George Karpus presently
owns 9,500 shares purchased on April 16, 2001 at $12.50 (10,000
shares) and April 11, 2003 at $13.33 (5,000 shares). He sold on January 20
& 25 at $13.81 (200 shares), February 10 at $13.96 (50 shares), and
February 18 at $13.69 (200 shares), June 22, 2005 at $13.89 (250 shares),
June 27 & 28 at $13.89 ( 150 shares), June 28 at $13.87 (100 shares),
June 29 at $13.83 and $ 13.84 ( 200 shares), June 29 & 30 at $13.89 & $
$13.88 (750 shares), and June 29 & 30 at $13.87 & $ 13.94 ( 500
shares), July 5, 2005 at $13.87 (300 shares), July 6 & 7 at $13.89 ( 900
shares), July 7 at $13.85 & $13.86 (300 shares), July 7 & 8 at $13.88 &
$13.89 (500 shares), July 11 & 12 at $13.87 & $13.88 (300 shares), July
13 & 14 at $13.87 & $13.88 (600 shares), and July 18 at $13.91 (100
shares). None of the other Principals presently owns shares.
b) KIM has the sole power to dispose of and to vote all of such Shares
under limited powers of attorney.
c) The first open market purchase occurred on December 8, 2000 as
previously reported. Open market purchases for the last 60 days for
the Accounts. There have been no dispositions and no acquisitions,
other than by such open market purchases, during such period.
DATE
SHARES
PRICE PER
SHARE
10/31/2005
1000
13.85
The Accounts have the right to receive all dividends from, any proceeds
from the sale of the Shares. KIM reserves the right to further accumulate
or sell shares. None of the Accounts has an interest in shares constituting
more than 5% of the Shares outstanding.
ITEM 6 Contracts, Arrangements, Understandings, or Relationships with Respect
to Securities of the Issuer.
Except as described above, there are no contracts, arrangements,
understandings or relationships of any kind among the Principals and KIM
and between any of them and any other person with respect to any of MNP
securities.
ITEM 7 Materials to be Filed as Exhibits
Not applicable.
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete,
and correct.
Karpus Management, Inc.
November 9, 2005 By:_______________________________
Date Signature
Dana R. Consler, Senior Vice President
Name/Title
EXHIBIT ONE
Proposal for Tender Offer
VIA OVERNIGHT, FAX, CERTIFIED MAIL
August 4, 2005
Robert I. Frenkel, Esq.
Salomon Bros Municipal Partner
Secretary & Chief Legal Officer
300 First Stamford Place ? 4th Floor
Stamford, CT 06902
Dear Mr. Frenkel:
Karpus Management, Inc. d/b/a Karpus Investment Management (KIM), is
the beneficial owner as of July 31, 2005, of 310,090 shares of the common
stock of Salomon Brothers Municipal Partners Fund (MNP) (the Fund)
(approximately 5.386% of the outstanding common shares) as attested
by Schedule 13D/A filings with the Securities and Exchange Commission
We have been the beneficial owner of the shares valued at more than $2,000
for more than one year and expect to continue ownership through the date of
the Fund?s next shareholder meeting. KIM?s first purchase of shares began on
December 8, 2000. All such purchases have been made in the open market.
Pursuant to Rule 14-28(b) (2) (ii) of the Securities Exchange Act of 1934, we
(KIM) are hereby submitting the following proposal and supporting statement
for inclusion in any and all proxy materials at the next meeting of
shareholders. Attached is our Schedule 13D as electronically filed with the
Securities and Exchange Commission.
PROPOSAL
KIM proposes that the Fund conduct a tender offer for up to 25% of the
outstanding shares of the Fund at net asset value to be voted on at the
next meeting of shareholders. Should the Board of Directors recommend
to shareholders that a new advisory agreement be ratified, we propose the
tender offer for shares at net asset value be increased to include all shares
that did not vote ?for? the new investment advisory contract. This would
include all abstentions and broker non-votes.
SUPPORTING STATEMENT
According to the original prospectus, the Board of Directors, in consultation
with the Investment Manager and the Investment Advisor, will review on an
annual basis the possibility of further open market repurchases and/or tender
offers for the common stock
The Fund manager has provided exceptional net asset performance to
shareholders but has yet to close the discount to net asset value.
Net asset performance from June 30, 2004 through June 30, 2005
has been 9.19% verses Morningstar Intermediate Municipal Fund
return of 5.49% and Lehman 7 Year Municipal Index return of
5.91%. Yet the Fund continues to trade at a discount to net asset value!
KIM believes the current Fund Management and Board of Directors
of MNP have not taken adequate measures to close this discount. For
the time period of June 30, 2004 through June 30, 2005 MNP traded
at an average discount of 11.97%. MNP has traded at a significant
discount to NAV since the end of 1994, over 10 years. What steps
have been taken to close this discount?
The original prospectus stated ?If, at any time after the second year
following the offering, the Common Stock publicly trades for a substantial
period of time at a substantial discount from the NAV, the Board of
Directors will consider at its next regularly scheduled meeting, taking
various actions designed to eliminate the discount, which may include
recommending to shareholders the conversion of the Fund to an open
-end investment company?. This clearly dictates the original intent not to
allow the fund to trade at significant discounts, protecting investor?s
economic interest in the Fund. Why has the Board ignored this intent to the
detriment of shareholders? Every shareholder that has sold shares in the last
10 + years in the market place received less for their shares than they were
entitled to. We believe the Board has breeched their fiduciary
responsibilities to these shareholders that sold at prices below NAV.
Additionally, MNP is plagued by low trading volume. From June 30, 2004
through June 30, 2005 average daily trading volume has been 8,905 shares.
Large shareholders who do not agree with the possible changes in the fund
management contract and who may wish to liquidate their position could
severely depress the Fund?s market price because of persistently low volume.
Dissenters deciding to sell their shares could cause the discount to NAV
to widen harming both existing shareholders and sellers. Dissenters have rights
under the law that may provide net asset value for their shares.
It is the fiduciary duty of the Board of Directors to allow Fund shareholders
the ability to receive economic benefits from any management transition.
Any merger to, or with, an open-end fund should benefit all shareholders
and could create economies of scale that would reduce the expense ratio.
Should the Board decide to open-end the Fund or to merge the Fund with
another open-end fund our proposal for tender would be withdrawn.
END OF PROPOSAL
Very truly yours,
Sharon L. Thornton
Senior Fixed Income Analyst/Portfolio Mgr.
EXHIBIT TWO
Shareholder Communication Filed October 5, 2005
KARPUS INVESTMENT MANAGEMENT
183 SULLY?S TRAIL
PITTSFORD, NEW YORK 14534
(585) 586-4680
for
Salomon Brothers Municipal Partners Fund Inc.
Salomon Brothers Municipal Partners Fund II Inc.
This letter is being sent to you by Karpus Investment Management (KIM)
to enlist your support as a fellow shareholder. Citigroup is selling its
Investment Management business to Legg Mason for $3.7 Billion. KIM
believes that there is a benefit to everyone BUT the shareholders in
this transaction. Citigroup accuses KIM of conducting a ?side-show?
by raising these critical shareholder issues.
We should not go quietly and accept this transaction without a benefit
to us, the shareholders. We have no assurances who will be conducting
the day-to-day management of the Funds in the future! The Boards of
Directors of our Funds are treating us like cattle and trading us. They
have a duty to address our concerns.
The original prospectuses stated that the Boards of Directors would
annually consider methods to manage or close the market discount
of the Funds verses net asset value. We asked the Funds to submit
a proposal to shareholders asking the Boards of Directors to consider a
tender offer for 25% of the outstanding shares. The Boards chose not to
let shareholders voice their opinions on this proposal, which would enable
shareholders to receive a substantial economic benefit should they choose
to leave the Fund!
What do we want to gain?
As of September 30, 2005, Salomon Brothers Municipal Partners Fund
closed at $13.99 per share verses the net asset value of $15.03. Net asset
value is what the securities within the Fund are worth in the marketplace.
Should you have been allowed to realize the real value as of this date, your
investment would have increased by 7.43% or $1.04 per share.
As of September 30, 2005, Salomon Brothers Municipal Partners Fund II
closed at $13.38 per share with a net asset value of $14.59 per share.
Should you have been allowed to realize the real value as of this date,
your investment would have increased by 9.04% or $1.20 per share.
KIM wants ALL shareholders to be able to reap an economic benefit
from this transaction. If Citigroup and Legg Mason benefit, so should we!
We believe that this is the ONLY CHANCE WE MAY HAVE to make
the Boards of Directors and the Funds Management meet our expectations
of closing or eliminating the discount to net asset value of the Funds.
We want this economic benefit before we will agree to transfer management
of the Funds.
By voting the GREEN CARD we will be sending a message to the Boards
of Directors that they need to honor commitments made in the Funds?
original prospectuses to close their persistent trading discounts.
VOTE AGAINST THIS TRANSFER
If you have already received and voted a white proxy card of either Fund,
you can rescind your vote by voting the GREEN proxy card provided to
you by Karpus Investment Management.
WE NEED YOUR SUPPORT TO ALERT MANAGEMENT AND THE
BOARD OF DIRECTORS THAT WE WILL NOT GO QUIETLY
WITHOUT AN ECONOMIC BENEFIT FOR THE SHAREHOLDERS.
VOTE THE GREEN CARD WITH KARPUS, BEWARE OF
TELEPHONE SOLICITATIONS; MAKE SURE YOUR VOTE IS
COUNTED AND COUNTED ACCORDING TO YOUR WISHES.
EXHIBIT THREE
Letter to the Board of Directors Sent October 18, 2005
KARPUS INVESTMENT MANAGEMENT
183 SULLY?S TRAIL
PITTSFORD, NEW YORK 14534
(585) 586-4680
for
Salomon Brothers Municipal Partners Fund Inc.
Salomon Brothers Municipal Partners Fund II Inc.
Dear Board Member:
We would like to focus your attention on the following language contained
in the prospectuses for Salomon Brothers Municipal Partners Fund Inc. (MNP)
and Salomon Brothers Municipal Partners Fund II Inc. (MPT): ?... if, at any
time after the second year following this offering, the Common Stock publicly
trades for a substantial period of time at a substantial discount from net asset
value, the Board of Directors will consider, at its next regularly scheduled
meeting, taking various actions designed to eliminate the discount, which
may include recommending to shareholders the conversion of the Fund to
an open-end investment company.? Notwithstanding this provision stated
identically in both Funds? prospectuses, persistent discounts have been
tolerated without any action for over ten years.
Why have the Boards been ignoring this lifeboat provision contained in the
Funds? original prospectuses? After all, this specific provision may have
induced many of us to become shareholders in the first place.
How could it be perceived by the Board for the last ten years that the most
rational and prudent path to pursue maximization of shareholder value for
both funds is no action at all? From our perspective, it seems as though
your first ?action? to address our Funds? discounts is to trivialize the issue
and hand it off to Legg Mason. From your past and your predecessor?s
past inactions, what assurances can be made to shareholders that their
investments are not being rubber stamped for the best interests of Citigroup
and the current Boards?
Couldn?t the synergy and economies of scale that you claim you are
looking for in completing the Legg Mason transaction be achieved by
pursuing the following two less costly alternatives: (1) simply
consolidating or merging the two Funds; and (2) pursuing the actions
prescribed by the prospectuses that you promised to examine upon
acceptance of your directorships? Don?t you, as our Funds? Boards,
have a duty to act prudently and exercise sound judgment with regard
to minimizing Fund expenses and maximizing shareholder value? As
a simple example of how little thought has been put into managing our
funds and their expenses, let us examine our Funds and how ?different?
they are from one another.
In comparing MNP side-by-side with MPT, there are minimal variations
that differentiate one fund from the other. In fact, from both an investment
and administration perspective, the two Funds are substantially identical. As
proof positive from an investments perspective, factors such as the total
value of investments, geographic dispersion of investments, sector allocation,
overall credit quality, leveraged duration and unleveraged duration vary by
minimal amounts. Additionally, roughly 15.86% of shareholders of MNP
own MPT, and 16.39% of shareholders of MPT own MNP.
Alternatively, from an administrative perspective, according to the Funds?
semi-annual report to shareholders, dated as of June 30, 2005, the Funds
both pay: (1) listing fees on the New York Stock Exchange; (2) auction
agent fees; (3) fees for producing shareholder reports; (4) custody fees;
(5) transfer agent fees; (6) insurance fees; (7) legal fees to the same
attorney; (8) management fees to the same investment manager; and
(9) directors? fees to the same, identical Board of Directors. About the
only difference in terms of expenses is that the Funds pay two different
auditors to audit substantially the same Fund.
Should the Boards decide to become active and consider consolidating the
two Funds, shareholders would benefit from the minimization of duplicate
expenses. Our analysis estimates a reduction in expenses of roughly 20%,
equating to roughly $200,000 - $250,000 in annual savings.
Perhaps the most significant similarity which contains possibly the highest
potential for reduction of costs relates to the composition of the Board itself.
It seems peculiar that each ?independent? director of our Funds serves on an
average of thirty-six other portfolios in the same Fund complex being
transferred to Legg Mason. This certainly appears to inherently conflict
with a prudent person?s ability to ?independently? determine what is in the
best interests of maximizing value and minimizing costs in any one
particular fund.
In your letter to shareholders on October 5th, you remind us that you, as
Board members, have a fiduciary duty to act in the interests of all of the
Funds? shareholders. In what capacity does inactivity and a failure to
address expense reduction issues relate to this alleged duty that you
possess? As yet another example of inaction, you cite expense ratio
increases as a reason for not considering tender offers yet do not propose
merging the Funds to save expenses. We fail to see the logic in your
decision making processes.
As shareholders of the Funds, we refuse to sit idly by and continue to
watch mismanagement be simply reassigned to another party by virtue
of the signature of Citigroup?s pen. We believe that it is time for the
Boards to place shareholder interests first.
Our message to you is simple: the purpose of an ?independent? Board is not
to rubber stamp the dicta of management. We believe that Board members
need to be held accountable by shareholders to fulfill their contractually
prescribed duties. Should the Boards decide not to take appropriate actions
to address our concerns, we will seek to take all steps necessary to remedy
the current Boards? inadequacies, including, but not limited to, replacement
of the current Boards of Directors.
Sincerely,
Karpus Investment Management