Seward & Kissel LLP
1200 G Street, N.W.
Washington, D.C. 20005
Telephone: (202) 737-8833
Facsimile: (202) 737-5184
www.sewkis.com
October 23, 2006
VIA EDGAR
Ms. Linda Stirling
Ms. Sheila Stout
Division of Investment Management
Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Re: Alliance World Dollar Government Fund II, Inc.
N-14 8C
File No. 811-07732
Dear Ms. Stirling and Ms. Stout:
This letter responds to comments of the staff (the "Staff") of the
Securities and Exchange Commission (the "SEC") on the Form N-14 8C filing for
Alliance World Dollar Government Fund II, Inc. (the "Company") regarding the
Company's acquisition of Alliance World Dollar Government Fund, Inc. (the
"Acquisition") as provided orally to Young Seo of this office on October 5, 2006
by Ms. Stout ("Accounting Comments") and on October 12, 2006 by Ms. Stirling
("Staff Comments"). The Staff's comments and the Company's responses are
discussed below.(1)
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(1) Capitalized terms have the same meaning as in the Prospectus/Proxy
Statement unless otherwise defined.
Staff Comments
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Prospectus/Proxy Statement
--------------------------
Comment 1: Summary: In the Comparison of Investment Objectives and Policies
table, please highlight any significant or material differences
between the Funds' Principal Investment Strategies, particularly
for the first and second bullet points for AWDGF.
Response: We believe that the only significant difference, which is
disclosed, is that the Company invests in corporate debt while
Alliance World Dollar Government Fund, Inc. ("AWDGF") does not.
We have not revised the Proxy/Prospectus with respect to this
comment.
Statement of Additional Information
-----------------------------------
Comment 2: Management of the Funds - Directors: Please disclose any
directorships held by any of the Directors outside of the
AllianceBernstein Fund Complex.
Response: We believe that this information is included in the SAI.
Comment 3: Please include a disclosure regarding control persons and
ownership of 5% or more of the outstanding shares of the Funds.
Response: We have added the disclosure in response to this comment.
Comment 4: Please include a disclosure regarding the anti-money laundering
("AML") compliance officer, if any.
Response: As a closed-end fund that is not currently offering its
securities, the Company does not have AML compliance procedures
nor does it have an AML compliance officer.
Accounting Comments
-------------------
Prospectus/Proxy Statement
--------------------------
Comment 5: Summary/Information About the Proposed Transaction: The
Prospectus/Proxy Statement states that the projected expenses of
the Acquisition, largely those for legal, accounting, printing
and proxy solicitation expenses, will be borne by AWDGF. It is
also stated in Comparison of Investment Objectives and Policies
that it would be appropriate for AWDGF to pay the Acquisition and
portfolio repositioning costs because AWDGF's stockholders would
derive the greatest benefits from the Acquisition. Please provide
an explanation as to why it is fair for all acquisition expenses
to be borne by AWDGF when it must be that both Funds are
receiving benefits from the Acquisition. AWDGF II must be
receiving some benefits from the Acquisition, such as acquiring
additional assets; otherwise it will not be entering the
transaction.
Response: The Board of Directors determined that it was appropriate for
AWDGF to bear the Acquisition and portfolio repositioning costs
because the Fund's expense would be substantially reduced and it
would be able to take advantage of broader investment strategies.
The Acquisition is neutral for the Company, which has current
assets of $984 million as compared to AWDGF's current assets of
$129 million.
Comment 6: Summary/Information About the Proposed Transaction: The
Prospectus/Proxy Statement states the Acquisition would be
beneficial to the stockholders of AWDGF because it is expected to
result in an expense ratio for the combined Fund that is lower
than the current expense ratio of AWDGF. AWDGF, however, is
paying the costs of the Acquisition, including the cost of
portfolio repositioning, and therefore would not be realizing the
lower fees right away. Please provide the "pay back period,"
i.e., how long it would take before AWDGF stockholders begin to
realize reduction in fees.
Response: AWDGF's stockholders will begin realizing the reduction in fees
immediately, after the Acquisition as the Acquisition and
repositioning costs, approximately $0.04/share, will be paid
before the Acquisition occurs. These costs will be more than
offset by the expected reduction in the annual fees of $0.34 as a
result of the Acquisition.
Comment 7: Appendix A - Fee Table: Comparison of Total Expense Ratios in
Summary states that the fees and expenses described in the Fee
Table are as of March 31, 2006. Please restate this in the
introductory paragraph to Appendix A.
Response: We have revised Appendix A in response to this comment.
Comment 8: Appendix A - Fee Table: Please verify that "Other Expenses"
include administrative fees.
Response: "Other Expenses" includes administrative fees.
Statement of Additional Information
-----------------------------------
Comment 9: Pro Forma Financial Statements: Please include an introductory
paragraph required under Article 11-02(b)(2).
Response: We have revised the pro forma financial statements to include an
introductory paragraph required under Article 11-02(b)(2)
(description of (i) the transaction, (ii) the entities involved,
(iii) the periods for which the pro forma information is
presented, and (iv) an explanation of what the pro forma
presentation shows.)
Comment 10: Pro Forma Financial Statements - Portfolio of Investment: The
principal amounts are shown only for the pro forma AWDGF II.
Please show the principal amounts of security holdings for each
of AWDGF and AWDGF II.
Response: We have revised the disclosure in response to this comment.
Comment 11: Pro Forma Financial Statements - Credit Default Swap Contracts,
Interest Rate Swap Contract and Reverse Repurchase Agreements:
The holdings appear to have been combined for AWDGF and AWDGF II.
Holdings for each agreement should be presented for each of AWDGF
and AWDGF II, separately.
Response: We have revised the disclosure in response to this comment.
Comment 12: Pro Forma Financial Statements - Statements of Assets and
Liabilities: The Prospectus/Proxy Statement states that a
realignment of the investment holdings of AWDGF before the
effective date of the Acquisition is anticipated and that the
associated costs would be borne by AWDGF. Article 11-02(b)(6) of
Reg. S-X requires that the "Adjustments" column in the Statements
of Assets and Liabilities show the costs borne by AWDGF related
to the realignment of its investment holdings.
Response: We have revised the disclosure in response to this comment.
Comment 13: Pro Forma Financial Statements - Statements of Assets and
Liabilities: The pro forma figures for "Unrealized appreciation
of credit default swap contracts" and "Unrealized depreciation of
credit default swap contracts" do not tie with the total from the
schedule of "Credit Default Swap Contracts."
Response: We believe that the sum of unrealized amounts in the schedule of
"Credit Default Swap Contracts" is equal to the net amount,
$7,232,767, of "Unrealized appreciation," $8,391,812, and
"Unrealized depreciation," ($1,159,045), in the Statements of
Assets and Liabilities.
Comment 14: Pro Forma Financial Statements - Statements of Assets and
Liabilities: Several lines items (ex. "Investments in securities,
at value") do not add up horizontally. Please review the
calculations.
Response: A few numbers did not transpose correctly in the Edgar conversion
process. We have revised the disclosure in response to this
comment.
Comment 15: Pro Forma Financial Statements - Statements of Assets and
Liabilities: The "Net Assets" numbers for AWDGF are off by
$10,000. Please correct.
Response: One of the "Net Assets" numbers did not transpose correctly in
the Edgar conversion process. We have revised the disclosure in
response to this comment.
Comment 16: Pro Forma Financial Statements - Note A: Note A states that the
Adviser will bear the proxy solicitation cost whereas the
Prospectus/Proxy Statement states that AWDGF will be responsible
for the cost of the Acquisition. Please reconcile.
Response: We have revised the disclosure to reflect that the Acquisition
costs will be borne by AWDGF.
Comment 17: Pro Forma Financial Statements - Note B: Please provide the
capital loss carryover figures for each of the Funds and any
limitation on the carryover that can be transferred to AWDGF II.
Response: As we explained, there will be no capital loss carryforwards of
AWDGF that would be transferred to AWDGF II in connection with
the Acquisition and we understand that this comment is applicable
only if there were such transferred carryforwards. We have not
revised the disclosure in response to this comment.
Comment 18: Pro Forma Financial Statements - Note C: The disclosure on
administrative fee appears to be for AWDGF. Please provide
information on administrative fee for AWDGF II.
Response: The disclosure on administrative fee is for AWDGF II. We have
revised the disclosure regarding administrative fee in the
Prospectus/Proxy Statement to clarify the administrative fee for
AWDGF II.
Comment 19: Pro Forma Financial Statements - Note C: The disclosure on
administrative fee of $107,000 appears to be for AWDGF. This
figure does not agree with $106,000 provided in the
Prospectus/Proxy Statement.
Response: The disclosure on administrative fee of $107,000 is for AWDGF II.
We have revised the disclosure regarding administrative fee in
the Prospectus/Proxy Statement to clarify the administrative fee
for AWDGF II.
Part C
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Comment 20: Exhibit 14: The Consent of Independent Registered Public
Accounting Firm does not provide the city, state and date
information.
Response: We are filing a revised Consent of Independent Registered Public
Accounting Firm that includes the city, state and date
information.
* * *
We hereby acknowledge that (i) the Company and AWDGF are each responsible
for the adequacy and accuracy of the disclosures in the filing on Form N-14 8C;
(ii) Staff comments or changes to disclosures in response to Staff comments in
the filing reviewed by the Staff do not foreclose the SEC from taking any action
with respect to the filing; and (iii) neither the Company nor AWDGF may assert
Staff comments as a defense in any proceedings initiated by the SEC or any
person under the federal securities laws of the United States.
If you have any additional comments or questions, please contact Kathleen
Clarke or the undersigned at (202) 737-8833.
Sincerely,
/s/ Young Seo
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Young Seo
cc: Andrew L. Gangolf, Esq.
Christina A. Morse, Esq.
Kathleen K. Clarke, Esq.
00250.0209 #709895