Federated Hermes Premier Municipal Income Fund announces final results of tender offer

Rhea-AI Summary

Federated Hermes Premier Municipal Income Fund (NYSE: FMN) has announced the final results of its tender offer. Due to oversubscription, the fund will purchase 32% of its issued and outstanding common shares on a pro rata basis. The purchase price is set at $12.67 per common share, which is 99% of the net asset value per common share as of October 11, 2024.

A total of 4,988,295 common shares were properly tendered, and the fund accepted 3,679,390 shares for payment. The proration factor is 0.7376799. Federated Hermes, Inc. (NYSE: FHI), the parent company, is a global leader in active, responsible investment management with $782.7 billion in assets under management as of June 30, 2024.

Positive

• Successful completion of tender offer indicates strong shareholder interest
• Purchase price set at 99% of NAV, potentially benefiting remaining shareholders
• Federated Hermes, Inc. manages $782.7 billion in assets, showcasing significant market presence

Negative

• Oversubscription of tender offer may indicate shareholder desire to exit the fund
• Reduction in fund size could potentially impact liquidity for remaining shareholders

Insights

Financial Analyst

The tender offer results for Federated Hermes Premier Municipal Income Fund (FMN) reveal significant investor interest, with the offer being oversubscribed. The fund will purchase 32% of its outstanding shares at $12.67 per share, a 1% discount to NAV. This represents a substantial $46.6 million capital return to shareholders, based on the 3,679,390 shares accepted.

The high participation rate suggests investors found the offer attractive, potentially due to market conditions or fund-specific factors. For remaining shareholders, this could lead to increased NAV and improved trading liquidity. However, the reduced asset base might impact the fund's expense ratio and investment flexibility.

While this news directly affects FMN, it's worth noting the broader context of Federated Hermes, Inc. (FHI) managing $782.7 billion in assets. The tender offer, while significant for FMN, is a relatively small transaction for the parent company and likely won't materially impact FHI's financials or stock performance.

PITTSBURGH, Oct. 15, 2024 /PRNewswire/ -- Federated Hermes Premier Municipal Income Fund (NYSE: FMN) announced today that in accordance with the terms of its tender offer, since the tender offer was oversubscribed, it will purchase 32% of its issued and outstanding common shares on a pro rata basis, with appropriate adjustment to avoid purchase of fractional shares (the "proration factor"). The purchase price is $12.67 per common share, which is 99% of the net asset value per common share determined as of the close of the regular trading session of the New York Stock Exchange on Oct. 11, 2024.

A total of 4,988,295 common shares were properly tendered and not withdrawn by Oct. 11, 2024, the final date for withdrawals, and the fund accepted for payment 3,679,390 common shares. The proration factor is 0.7376799. The fund will purchase the common shares that it has accepted for payment as promptly as practicable. 

Investors can view additional portfolio information in the Products section of FederatedHermes.com/us .

Federated Hermes, Inc. (NYSE: FHI) is a global leader in active, responsible investment management, with $782.7 billion in assets under management, as of June 30, 2024. We deliver investment solutions that help investors target a broad range of outcomes and provide equity, fixed-income, alternative/private markets, multi-asset and liquidity management strategies to more than 10,000 institutions and intermediaries worldwide. Our clients include corporations, government entities, insurance companies, foundations and endowments, banks and broker/dealers. Headquartered in Pittsburgh, Federated Hermes has more than 2,000 employees in London, New York, Boston and offices worldwide. For more information, visit  FederatedHermes.com/us .

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View original content:https://www.prnewswire.com/news-releases/federated-hermes-premier-municipal-income-fund-announces-final-results-of-tender-offer-302276368.html

SOURCE Federated Hermes, Inc.

FAQ

What was the purchase price per share in FMN's tender offer?

The purchase price was $12.67 per common share, which is 99% of the net asset value per common share as of October 11, 2024.

How many shares did Federated Hermes Premier Municipal Income Fund (FMN) accept in the tender offer?

The fund accepted 3,679,390 common shares for payment out of 4,988,295 shares that were properly tendered.

What was the proration factor for FMN's tender offer?

The proration factor for the tender offer was 0.7376799.

What percentage of FMN's issued and outstanding common shares will be purchased in the tender offer?

The fund will purchase 32% of its issued and outstanding common shares on a pro rata basis.