MFS Investment Management Proposes Reorganization of Three Municipal Funds to Enhance Liquidity
Written by Emily J. Thompson, Senior Investment Analyst
Source: Businesswire
- Reorganization Plan: MFS Investment Management announced the reorganization of MFS High Income Municipal Trust, MFS High Yield Municipal Trust, and MFS Investment Grade Municipal Trust into MFS Municipal Income Trust, aimed at increasing fund scale and liquidity, which may help reduce the discount to net asset value per share over time.
- Shareholder Voting: A special meeting is tentatively scheduled for March 11, 2026, to seek approval from common and preferred shareholders of each Target Fund for the proposed reorganizations, ensuring maximization of shareholder interests.
- New Investment Adviser: Following the reorganizations, Aberdeen Investments will be appointed as the new investment adviser, expected to enhance management efficiency and investment returns, thereby strengthening market competitiveness.
- Board Changes: The reorganization will also involve the election of five new trustees, ensuring optimized governance structures and professional decision-making to support the long-term strategic development of the funds.
Analyst Views on CMU
About CMU
MFS High Yield Municipal Trust (the Fund) is a diversified closed-end management investment company. The Fund's investment objective is to seek high current income exempt from federal income tax but may also consider capital appreciation. The Fund invests, under normal market conditions, over 80% of its net assets, including assets attributable to preferred shares and borrowings for investment purposes, in tax-exempt bonds and tax-exempt notes. The Fund invests primarily in municipal instruments. The Fund invests 25% or more of the fund’s total assets in municipal instruments that finance similar projects, such as those relating to education, healthcare, housing, utilities, water, or sewers. It also invests in taxable instruments, including derivatives. The Fund offers a dividend reinvestment and cash purchase plan that allows common shareholders to reinvest all of the distributions paid by the fund. The investment advisor of the fund is Massachusetts Financial Services Company.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
