Virtus Convertible & Income 2024 Target Term Fund Announces Termination and Liquidation

Rhea-AI Summary

Virtus Convertible & Income 2024 Target Term Fund (NYSE: CBH) has completed its termination and liquidation on August 30, 2024. The Fund's final net asset value (NAV) was $9.2342 per common share, with liquidation proceeds paid to shareholders on September 4, 2024. Launched on June 29, 2017, the Fund paid total distributions of $4.2152 per share, representing an average annual distribution rate of 6.36% on the final NAV. The annualized total return for initial investors was 5.34% based on NAV and 5.26% based on market price. Shareholders may recognize gains or losses for tax purposes and are advised to consult tax advisors regarding potential tax liabilities from the liquidation proceeds.

Positive

• Final NAV of $9.2342 per common share
• Total distributions of $4.2152 per share over the Fund's lifetime
• Average annual distribution rate of 6.36% on final NAV
• Annualized total return of 5.34% on NAV for initial investors
• Annualized total return of 5.26% on market price for initial investors

Negative

• Fund termination and liquidation, potentially limiting investment options for shareholders

Financial Analyst

The termination and liquidation of the Virtus Convertible & Income 2024 Target Term Fund marks the successful completion of its investment cycle. With a final NAV of $9.2342 per share and total distributions of $4.2152 per share over its lifetime, the fund delivered an average annual distribution rate of 6.36%. This performance, coupled with annualized total returns of 5.34% on NAV and 5.26% on market price, suggests the fund largely met its objectives.

However, investors should note that these returns, while positive, are relatively modest in the context of the broader market performance over the same period. The fund's termination as planned demonstrates the reliability of target-term funds in meeting their stated objectives, which can be appealing to investors seeking predictable investment horizons. It's important for shareholders to consider the tax implications of the liquidation, as it may trigger capital gains or losses depending on their individual cost basis.

Tax Expert

The liquidation of the Virtus Convertible & Income 2024 Target Term Fund presents important tax considerations for shareholders. The distribution of liquidation proceeds may result in reportable capital gains or losses, depending on each investor's cost basis and holding period. It's important to note that the $9.2342 per share final NAV doesn't necessarily represent the taxable amount, as the tax impact will be based on the difference between this amount and the investor's adjusted cost basis.

Investors should be aware that the Form 1099-DIV they'll receive will be critical for accurate tax reporting. Given the complexity of tax treatment for fund liquidations, especially with the fund's history of distributions, shareholders would be wise to consult with tax professionals to navigate potential tax liabilities or opportunities for tax-loss harvesting. This event underscores the importance of considering tax implications in investment strategies, particularly for target-term funds with predetermined liquidation dates.

HARTFORD, Conn.--(BUSINESS WIRE)-- Virtus Convertible & Income 2024 Target Term Fund (NYSE: CBH) (“the Fund”) completed its termination and liquidation following the close of business on August 30, 2024. The termination and liquidation were performed in accordance with the Fund’s investment objectives and organizational documents, consistent with the Fund’s previously announced liquidation plans.

Upon the Fund’s termination, the Fund had a final net asset value (NAV) of $9.2342 per common share. The liquidation proceeds were paid on September 4, 2024 to all Fund shareholders.

The Fund, which was launched on June 29, 2017, paid distributions totaling in the aggregate $4.2152 per share, which equates to an average annual distribution rate of 6.36% on the final NAV as of August 30, 2024. The annualized total return on the final NAV for shareholders who invested at the initial public offerings was 5.34% and the annualized total return on the final market price, as of August 26, 2024, was 5.26%. Shareholders may recognize a gain or loss for U.S. tax purposes as a result of the liquidation and should consult with their own tax advisors about any tax liability resulting from the receipt of liquidation proceeds.

The amount of the distribution reported in this notice is not being provided for tax reporting purposes. The actual amounts and sources of the distributions for tax purposes will depend on the Fund’s investment experience through the Termination Date and may be subject to changes 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 Fund

Virtus Convertible & Income 2024 Target Term Fund’s investment objectives are to provide a high level of income and to return at least $9.835 per common share (the original net asset value per common share of beneficial interest before deducting offering costs of $0.02 per share) to holders of common shares on or about September 1, 2024, when the Fund will terminate, absent approval by the Fund’s Board of Trustees to extend the Fund’s term by up to six months. No assurance can be given that the Fund will achieve its investment objectives. Virtus Investment Advisers, Inc. is the investment adviser to the fund and Voya Investment Management is the subadviser.

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 the Fund’s investment objective and risks, please see the Fund’s annual report. A copy of the Fund’s most recent annual report may be obtained free of charge by contacting “Shareholder Services” as set forth at the bottom of this press release.

About Virtus Investment Partners

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/20240905557377/en/

For Further Information:

Shareholder Services

(866) 270-7788

closedendfunds@virtus.com

Source: Virtus Convertible & Income 2024 Target Term Fund

FAQ

When did Virtus Convertible & Income 2024 Target Term Fund (CBH) complete its termination and liquidation?

Virtus Convertible & Income 2024 Target Term Fund (CBH) completed its termination and liquidation on August 30, 2024.

What was the final net asset value (NAV) of CBH upon termination?

The final net asset value (NAV) of CBH upon termination was $9.2342 per common share.

When were the liquidation proceeds paid to CBH shareholders?

The liquidation proceeds were paid to CBH shareholders on September 4, 2024.

What was the total distribution paid by CBH over its lifetime?

CBH paid total distributions of $4.2152 per share over its lifetime.

What was the average annual distribution rate of CBH based on the final NAV?

The average annual distribution rate of CBH was 6.36% based on the final NAV as of August 30, 2024.