High Income Securities Fund Announces Results of Special Meeting and Commencement of Tender Offer

Rhea-AI Summary

High Income Securities Fund (NYSE: PCF) announced the results of a special shareholder meeting where all proposals were approved except one regarding the elimination of requirements for converting the Fund to an open-end mutual fund. The Fund is launching a tender offer to purchase up to 10,675,000 shares at 98% of the net asset value per common share as of December 9, 2024. The Fund may purchase an additional 2% of outstanding shares without amending the offer. The tender offer will expire at 5:00 p.m. Eastern Time on the Expiration Date, and shareholders holding shares in street name should contact their custodian regarding participation requirements.

Positive

• Tender offer to purchase up to 10,675,000 shares at 98% of NAV
• Ability to purchase additional 2% of outstanding shares without amendment

Negative

• Failed proposal to eliminate open-end mutual fund conversion requirement
• Tender offer price represents a 2% discount to NAV

Insights

Financial Analyst

This tender offer represents a significant corporate action that could impact shareholder value. The Fund is offering to purchase up to 10,675,000 shares at 98% of NAV, providing shareholders with a liquidity opportunity slightly below market value. The failed proposal to eliminate the open-end conversion requirement maintains an important shareholder protection mechanism. This tender offer could help reduce the discount to NAV if fully subscribed, potentially benefiting remaining shareholders. However, participating shareholders must accept a 2% discount to NAV, which represents the cost of liquidity in this case.

The ability to purchase an additional 2% of outstanding shares without amendment provides flexibility for the Fund to manage the tender offer execution. Shareholders should carefully consider their individual circumstances, including tax implications and investment timeline, before deciding whether to participate in the tender.

MILWAUKEE, Nov. 08, 2024 (GLOBE NEWSWIRE) -- High Income Securities Fund (the “Fund”) (NYSE: PCF) announced that at special meeting of shareholders today, shareholders approved all proposals except a proposal to amend the Fund’s Declaration of Trust to eliminate the requirement that a proposal to convert the Fund to an open-end mutual fund be submitted to shareholders under certain circumstances. 

Separately, today the Fund is commencing a tender offer to purchase up to 10,675,000 shares of the Fund at 98% of the net asset value per common share as of the close of the regular trading session of the New York Stock Exchange on the Expiration Date which is December 9, 2024 (unless extended). In accordance with the rules of the U.S. Securities and Exchange Commission (the “Commission”), the Fund may purchase additional shares not to exceed 2% of the outstanding shares without amending or extending the tender offer.

The tender offer will expire at 5:00 p.m. Eastern Time, on the Expiration Date. The tender offer is being made upon the terms and subject to the conditions set forth in the tender offer statement, which will be sent to shareholders as soon as practicable. Shareholders that hold shares in street name and wish to accept the tender offer should contact their custodian to confirm when it requires notice (which may be prior to the Expiration Date).

This announcement is not a recommendation or an offer to purchase any securities of the Fund. The Fund has filed with the Commission a tender offer statement on Schedule TO under the Securities Exchange Act of 1934, as amended, relating to the tender offer. Shareholders should read the tender offer statement carefully as it contains important information. Shareholders may obtain the tender offer statement and other filed documents without charge at the Commission’s website at http://www.sec.gov.

For more information, please call InvestorCom, the Fund’s information agent, at (877) 972-0090.

FAQ

What is the expiration date for PCF's tender offer?

The tender offer expires at 5:00 p.m. Eastern Time on December 9, 2024, unless extended.

How many shares is PCF offering to purchase in its tender offer?

PCF is offering to purchase up to 10,675,000 shares, with the ability to purchase an additional 2% of outstanding shares without amending the offer.

What price is PCF offering for shares in the tender offer?

PCF is offering to purchase shares at 98% of the net asset value per common share as of the close of trading on December 9, 2024.

Which proposal was not approved at PCF's special meeting?

The proposal to amend the Fund's Declaration of Trust to eliminate the requirement for shareholder voting on converting to an open-end mutual fund was not approved.