NCV, NCZ Announce Reverse Stock Splits and Monthly Distributions
Virtus Convertible & Income Fund (NYSE: NCV) and Virtus Convertible & Income Fund II (NYSE: NCZ) announced a 1-for-4 reverse stock split effective February 10, 2025. The funds will maintain their trading symbols but receive new CUSIPs. Shareholders will be paid cash for fractional shares while maintaining the same percentage ownership. The boards expect the split to result in higher per-share market prices, potentially broadening the investor base and improving stock liquidity. Monthly distributions will continue with adjusted rates: NCV's distribution will increase from $0.034 to $0.136, and NCZ's from $0.030 to $0.120 after the split.
Virtus Convertible & Income Fund (NYSE: NCV) e Virtus Convertible & Income Fund II (NYSE: NCZ) hanno annunciato un split azionario inverso 1-per-4 che entrerà in vigore il 10 febbraio 2025. I fondi manterranno i loro simboli di trading ma riceveranno nuovi CUSIP. Gli azionisti riceveranno un pagamento in contanti per le azioni frazionarie mantenendo la stessa percentuale di proprietà. I consigli si aspettano che lo split porti a prezzi di mercato per azione più elevati, potenzialmente ampliando la base di investitori e migliorando la liquidità delle azioni. Le distribuzioni mensili continueranno con tassi adeguati: la distribuzione di NCV aumenterà da $0.034 a $0.136, e quella di NCZ da $0.030 a $0.120 dopo lo split.
Virtus Convertible & Income Fund (NYSE: NCV) y Virtus Convertible & Income Fund II (NYSE: NCZ) anunciaron un desdoblamiento de acciones inverso 1 por 4 que entrará en vigor el 10 de febrero de 2025. Los fondos mantendrán sus símbolos de negociación, pero recibirán nuevos CUSIP. Los accionistas recibirán efectivo por las acciones fraccionarias manteniendo el mismo porcentaje de propiedad. Las juntas esperan que el desdoblamiento resulte en precios de mercado por acción más altos, lo que podría ampliar la base de inversores y mejorar la liquidez de las acciones. Las distribuciones mensuales continuarán con tasas ajustadas: la distribución de NCV aumentará de $0.034 a $0.136, y la de NCZ de $0.030 a $0.120 después del desdoblamiento.
Virtus Convertible & Income Fund (NYSE: NCV)와 Virtus Convertible & Income Fund II (NYSE: NCZ)는 2025년 2월 10일부터 시행되는 4주 중 1주 역분할을 발표했습니다. 펀드는 거래 기호를 유지하지만 새로운 CUSIP을 받게 됩니다. 주주들은 같은 비율의 소유권을 유지하면서 분할 주식에 대해 현금을 지급받게 됩니다. 이사회는 분할이 주당 시장 가격을 높이는 결과를 가져올 것이라고 기대하고 있으며, 이는 투자자 기반을 확대하고 주식 유동성을 향상시킬 수 있습니다. 월별 배당금은 조정된 비율로 계속해서 지급됩니다: NCV의 배당금은 $0.034에서 $0.136으로, NCZ의 배당금은 $0.030에서 $0.120으로 증가합니다.
Virtus Convertible & Income Fund (NYSE: NCV) et Virtus Convertible & Income Fund II (NYSE: NCZ) ont annoncé un dividende inversé de 1 pour 4 qui prendra effet le 10 février 2025. Les fonds conserveront leurs symboles de négociation mais recevront de nouveaux CUSIP. Les actionnaires seront payés en espèces pour les actions fractionnaires tout en maintenant le même pourcentage de propriété. Les conseils d'administration s'attendent à ce que le dividende entraîne des prix de marché par action plus élevés, ce qui pourrait élargir la base d'investisseurs et améliorer la liquidité des actions. Les distributions mensuelles continueront avec des taux ajustés : la distribution de NCV augmentera de 0,034 $ à 0,136 $, et celle de NCZ de 0,030 $ à 0,120 $ après le dividende.
Virtus Convertible & Income Fund (NYSE: NCV) und Virtus Convertible & Income Fund II (NYSE: NCZ) haben einen 1-für-4 Rücksplit angekündigt, der am 10. Februar 2025 in Kraft tritt. Die Fonds werden ihre Handelssymbole beibehalten, aber neue CUSIPs erhalten. Aktionäre werden für Bruchteile von Aktien in bar entschädigt, während der gleiche prozentuale Eigentumsanteil erhalten bleibt. Die Vorstände erwarten, dass der Split zu höheren Marktpreisen pro Aktie führen wird, was möglicherweise die Anlegerbasis erweitert und die Liquidität der Aktien verbessert. Die monatlichen Ausschüttungen werden mit angepassten Sätzen fortgesetzt: Die Ausschüttung von NCV wird von $0.034 auf $0.136 steigen, und die von NCZ von $0.030 auf $0.120 nach dem Split.
- Reverse stock split may improve market liquidity and broaden investor base
- Potential reduction in per-share transaction fees and administrative costs
- Shareholders maintain same percentage ownership post-split
- Monthly distribution payments continue without interruption
- Cash payment for fractional shares may result in partial position liquidation
Insights
This reverse stock split announcement represents a significant structural change for both NCZ and NCV funds. The 1-for-4 reverse split will mechanically quadruple the share price while reducing the number of outstanding shares by 75%. The monthly distribution will similarly adjust from
While reverse splits are often viewed negatively in single stocks, for closed-end funds they can be beneficial. The higher share price could attract institutional investors with minimum price requirements and potentially reduce trading costs. However, investors should note that the split itself doesn't change the fund's underlying value or their proportional ownership. The cash settlement of fractional shares may create minor tax implications for some holders.
The Funds’ common shares will begin trading on a split-adjusted basis with new CUSIPs when the market opens on the Effective Date and one new share will be issued for every four outstanding common shares currently outstanding of NCV and NCZ. Shareholders will be paid in cash for any fractional shares that may result from the reverse stock split (the “Transaction”). Immediately following the Transaction, each shareholder of record will hold the same percentage of their Fund’s outstanding common stock after the Transaction as held immediately prior to the Transaction and will receive the same monthly cash flow from distributions on net asset value, subject to adjustments for the intended cash repurchase of fractional shares resulting from the Transaction.
The Transaction is expected to result in a higher per-share market price for each Fund’s common shares. The Board believes that increasing the per-share market price may broaden the range of potential investors in each Fund’s shares, thereby potentially improving the market for, and liquidity of, the Funds’ common stock. In addition, the Transaction may benefit shareholders and the Funds by reducing certain per-share transaction fees and other administrative costs, such as stock exchange listing fees.
Each Fund will retain its trading symbol but will be assigned a new CUSIP number, which will be announced prior to the Transaction and will become effective on the Effective Date.
Prior to the Transaction, the Funds announced the following distributions on their respective common shares:
Virtus Convertible & Income Fund:
Ticker |
Amount of Distribution |
Ex-Date/Record Date |
Payable Date |
NCV |
|
December 12, 2024 |
December 30, 2024 |
NCV |
|
January 13, 2025 |
January 30, 2025 |
Virtus Convertible & Income Fund II:
Ticker |
Amount of Distribution |
Ex-Date/Record Date |
Payable Date |
NCZ |
|
December 12, 2024 |
December 30, 2024 |
NCZ |
|
January 13, 2025 |
January 30, 2025 |
After the Transaction, the dividend rate will be proportionally increased as follows:
Virtus Convertible & Income Fund:
Ticker |
Amount of Distribution |
Ex-Date/Record Date |
Payable Date |
NCV |
|
February 13, 2025 |
February 27, 2025 |
NCV |
|
March 13, 2025 |
March 28, 2025 |
Virtus Convertible & Income Fund II:
Ticker |
Amount of Distribution |
Ex-Date/Record Date |
Payable Date |
NCZ |
|
February 13, 2025 |
February 27, 2025 |
NCZ |
|
March 13, 2025 |
March 28, 2025 |
The distributions reported in this notice are estimates only and are not being provided for tax reporting purposes. The actual amounts and sources of the distributions for tax purposes will depend on each Fund’s investment experience during the remainder of its fiscal year and may be subject to change based on tax regulations. The Fund or your broker will send you a Form 1099-DIV for the calendar year that will tell you what distributions to report for federal income tax purposes.
About the Funds
Virtus Convertible & Income Fund and Virtus Convertible & Income Fund II each have an investment objective to provide total return through a combination of capital appreciation and high current income. Virtus Investment Advisers, Inc. is the investment adviser to each fund and Voya Investment Management is the subadviser.
For more information on these funds, contact shareholder services at (866) 270-7788, by email at closedendfunds@virtus.com, or through the Closed-End Funds section on the web at virtus.com.
Fund Risks
An investment in a fund is subject to risk, including the risk of possible loss of principal. A fund’s shares may be worth less upon their sale than what an investor paid for them. Shares of closed-end funds may trade at a premium or discount to their net asset value. For more information about each fund’s investment objective and risks, please see the funds’ annual report. A copy of the funds’ most recent annual report may be obtained free of charge by contacting “Shareholder Services” as set forth at the end of this press release.
About Virtus Investment Partners, Inc.
Virtus Investment Partners (NYSE: VRTS) is a distinctive partnership of boutique investment managers singularly committed to the long-term success of individual and institutional investors. We provide investment management products and services from our affiliated managers, each with a distinct investment style and autonomous investment process, as well as select subadvisers. Investment solutions are available across multiple disciplines and product types to meet a wide array of investor needs. Additional information about our firm, investment partners, and strategies is available at virtus.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241120132284/en/
For Further Information:
Shareholder Services
(866) 270-7788
closedendfunds@virtus.com
Source: Virtus Convertible & Income Fund and Virtus Convertible & Income Fund II
FAQ
What is the reverse stock split ratio for NCZ and NCV funds?
How will NCZ's distribution amount change after the reverse split?
When will the reverse stock split take effect for NCZ?
Will NCZ shareholders lose any ownership percentage after the reverse split?
