NCV, NCZ Announces Date of Reverse Stock Splits
Virtus Convertible & Income Fund (NCV) and Virtus Convertible & Income Fund II (NCZ) have announced a 1-for-4 reverse stock split effective February 10, 2025. The splits, approved by each Fund's board, aim to enhance shareholder value by increasing the per-share market price.
Post-split, shareholders will maintain their same percentage ownership, with one new share issued for every four existing shares. Cash payments will be made for fractional shares, except for participants in the Automatic Dividend Reinvestment Plan. The funds will retain their trading symbols but receive new CUSIP numbers.
Following the split, monthly distributions will be proportionally adjusted. NCV will distribute $0.136 per share on February 27 and March 28, 2025, while NCZ will distribute $0.120 per share on the same dates. The reverse splits aim to broaden the investor base and reduce per-share transaction fees and administrative costs.
Virtus Convertible & Income Fund (NCV) e Virtus Convertible & Income Fund II (NCZ) hanno annunciato uno split azionario inverso di 1 a 4 che entrerà in vigore il 10 febbraio 2025. Gli split, approvati dal consiglio di ciascun fondo, mirano a migliorare il valore per gli azionisti aumentando il prezzo di mercato per azione.
Dopo lo split, gli azionisti manterranno la stessa percentuale di proprietà, con una nuova azione emessa per ogni quattro azioni esistenti. I pagamenti in contante saranno effettuati per le azioni frazionarie, ad eccezione dei partecipanti al Piano di Reinvestimento Automatico dei Dividendi. I fondi manterranno i loro simboli di negoziazione ma riceveranno nuovi numeri CUSIP.
Successivamente allo split, le distribuzioni mensili saranno adeguate proporzionalmente. NCV distribuirà 0,136 dollari per azione il 27 febbraio e il 28 marzo 2025, mentre NCZ distribuirà 0,120 dollari per azione nelle stesse date. Gli split inversi mirano ad ampliare la base degli investitori e a ridurre le commissioni di transazione per azione e i costi amministrativi.
Virtus Convertible & Income Fund (NCV) y Virtus Convertible & Income Fund II (NCZ) han anunciado un dividendo en acciones revertido de 1 por 4, efectivo a partir del 10 de febrero de 2025. Las divisiones, aprobadas por la junta de cada fondo, tienen como objetivo mejorar el valor para los accionistas al aumentar el precio de mercado por acción.
Después de la división, los accionistas mantendrán el mismo porcentaje de propiedad, con una nueva acción emitida por cada cuatro acciones existentes. Se realizarán pagos en efectivo por las acciones fraccionarias, excepto para los participantes en el Plan de Reinversión Automática de Dividendos. Los fondos conservarán sus símbolos de negociación, pero recibirán nuevos números CUSIP.
Tras la división, las distribuciones mensuales se ajustarán proporcionalmente. NCV distribuirá $0.136 por acción el 27 de febrero y el 28 de marzo de 2025, mientras que NCZ distribuirá $0.120 por acción en las mismas fechas. Las divisiones inversas tienen como objetivo ampliar la base de inversores y reducir las tarifas de transacción por acción y los costos administrativos.
Virtus Convertible & Income Fund (NCV)와 Virtus Convertible & Income Fund II (NCZ)는 2025년 2월 10일부터 효력이 발생하는 1대 4의 주식 분할을 발표했습니다. 각 기금 이사회에서 승인된 이번 분할은 주당 시장 가격을 높여 주주 가치를 증대시키는 것을 목표로 하고 있습니다.
분할 후 주주들은 동일한 비율의 소유권을 유지하며, 4개의 기존 주식에 대해 1개의 새로운 주식이 발행됩니다. 분할되는 주식에 대해서는 현금 지급이 이루어지지만, 자동 배당 재투자 프로그램에 참여하는 경우는 제외됩니다. 기금은 거래 기호를 유지하되 새로운 CUSIP 번호를 받게 됩니다.
분할 이후 월별 배당금은 비례적으로 조정됩니다. NCV는 2025년 2월 27일과 3월 28일에 주당 $0.136을 분배하고, NCZ는 같은 날짜에 주당 $0.120을 분배합니다. 이러한 역분할은 투자자 기반을 확장하고 주당 거래 수수료 및 관리 비용을 줄이는 것을 목표로 합니다.
Virtus Convertible & Income Fund (NCV) et Virtus Convertible & Income Fund II (NCZ) ont annoncé une division inversée de 1 pour 4, valable à partir du 10 février 2025. Les divisions, approuvées par le conseil de chaque fonds, visent à accroître la valeur pour les actionnaires en augmentant le prix de marché par action.
Après la division, les actionnaires conserveront leur même pourcentage de propriété, avec une nouvelle action émise pour chaque quatre actions existantes. Des paiements en espèces seront effectués pour les actions fractionnaires, sauf pour les participants au Plan de Réinvestissement Automatique des Dividendes. Les fonds conserveront leurs symboles de négociation mais recevront de nouveaux numéros CUSIP.
Suite à la division, les distributions mensuelles seront ajustées proportionnellement. NCV distribuera 0,136 $ par action le 27 février et le 28 mars 2025, tandis que NCZ distribuera 0,120 $ par action aux mêmes dates. Les divisions inversées visent à élargir la base d'investisseurs et à réduire les frais de transaction par action ainsi que les coûts administratifs.
Virtus Convertible & Income Fund (NCV) und Virtus Convertible & Income Fund II (NCZ) haben einen 1-zu-4 Rücksplit der Aktien angekündigt, der am 10. Februar 2025 in Kraft tritt. Die Splits, die von dem jeweiligen Fondsrat genehmigt wurden, zielen darauf ab, den Aktionärswert zu steigern, indem der Marktpreis pro Aktie erhöht wird.
Nach dem Split behalten die Aktionäre ihren gleichen prozentualen Anteil, wobei für jede vier bestehenden Aktien eine neue Aktie ausgegeben wird. Cash-Zahlungen werden für fractional shares geleistet, mit Ausnahme der Teilnehmer am automatischen Dividendenauszahlungsplan. Die Fonds behalten ihre Handelssymbole, erhalten jedoch neue CUSIP-Nummern.
Nach dem Split werden die monatlichen Ausschüttungen proportional angepasst. NCV wird am 27. Februar und 28. März 2025 0,136 $ pro Aktie ausschütten, während NCZ am gleichen Datum 0,120 $ pro Aktie ausschütten wird. Die Rücksplits sollen die Investorenbasis erweitern und die Transaktionsgebühren pro Aktie sowie die Verwaltungskosten senken.
- Potential for improved market liquidity and broader investor base
- Expected reduction in per-share transaction fees and administrative costs
- Shareholders maintain same percentage ownership post-split
- Monthly distribution payments continue with proportional adjustments
- Possible taxable event for shareholders receiving cash for fractional shares
Insights
The announced 1-for-4 reverse stock split for NCZ represents a strategic financial engineering move that warrants careful analysis. Post-split, while the total market value remains unchanged, the higher nominal share price (approximately
The key implications include:
- Enhanced market mechanics: The higher price point may reduce bid-ask spreads as a percentage of share price, potentially improving trading efficiency.
- Cost optimization: The reduction in outstanding shares will lower administrative expenses like listing fees and transfer agent costs on a per-share basis.
- Dividend adjustment: The monthly distribution will be proportionally increased to
$0.12 per share, maintaining the same effective yield for investors. - Trading dynamics: While reverse splits don't directly affect market value, they often signal management's confidence in long-term prospects and commitment to improving trading characteristics.
However, investors should note that reverse splits historically have mixed track records in terms of long-term performance. The success will largely depend on the fund's ability to maintain stable net asset value and distribution levels post-split. The cash settlement of fractional shares could create minor tax implications for some holders, requiring careful consideration in tax planning.
The Funds will retain their trading symbols but have been assigned the following new CUSIP numbers as of the Effective Date: NCV: 92838X805 NCZ: 92838U801
The reverse stock splits are intended to result in a higher per-share market price for each Fund’s common shares. It is anticipated 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, each Fund’s common shares. In addition, the reverse stock splits may benefit shareholders and the Funds by reducing certain per-share transaction fees and other administrative costs, such as stock exchange listing fees.
Shareholders will be paid in cash for any fractional shares that may result from the reverse stock splits, except for shareholders participating in the Funds’ Automatic Dividend Reinvestment Plan who will receive fractional shares. Immediately following the reverse stock splits, each shareholder of record will hold the same percentage of their Fund’s outstanding common shares as held immediately prior to the reverse stock splits 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 reverse stock splits.
The reverse stock splits will not result in a taxable transaction for holders of the Funds, however, the exchange of fractional shares for cash may cause some shareholders to realize gains or losses, which could create a taxable event for those shareholders.
After the reverse stock splits, 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.
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For Further Information:
Shareholder Services
(866) 270-7788
closedendfunds@virtus.com
Source: Virtus Convertible & Income Fund and Virtus Convertible & Income Fund II
FAQ
When will the NCZ 1-for-4 reverse stock split take effect?
What is the new dividend amount for NCZ after the reverse stock split?
Will NCZ shareholders receive cash for fractional shares after the reverse split?
What is the new CUSIP number for NCZ after the reverse stock split?
How will the NCZ reverse stock split affect shareholder ownership percentages?
