The New America High Income Fund, Inc. Declares Distribution and Announces That Its Shares Will Cease Trading February 11 Prior to Reorganization

Rhea-AI Summary

The New America High Income Fund (NYSE: HYB) has announced two significant developments. First, it will distribute $0.04 per share on January 31, 2025, to shareholders of record as of January 17, 2025. Second, the Fund will undergo a reorganization into the T. Rowe Price High Yield Fund, effective after market close on February 21, 2025.

As part of this reorganization, HYB shares will cease trading on the NYSE after market close on February 11, 2025. Current Fund shareholders will receive Investor Class shares of the T. Rowe Price Fund. The Fund's investment adviser, T. Rowe Price Associates, manages approximately $1.6 trillion in assets, including about $20 billion in high yield investments as of September 30, 2024.

Positive

• Distribution of $0.04 per share announced for January 31, 2025
• Merger with larger asset manager T. Rowe Price, which manages $1.6 trillion in assets

Negative

• Fund will cease independent trading on NYSE after February 11, 2025
• Shareholders will be converted to Investor Class shares, potentially affecting their investment structure

Insights

Investment Fund Analyst

The announced reorganization of New America High Income Fund into T. Rowe Price High Yield Fund represents a significant structural change for current shareholders. The $0.04 per share distribution is relatively modest, but the key focus here is the fund's transition. After February 11, 2025, shareholders will lose the closed-end structure's unique characteristics, including its leverage potential and market price dynamics, as they transition to holding Investor Class shares of the T. Rowe Price Fund. This reorganization will provide shareholders with greater liquidity and eliminate the closed-end fund's typical discount/premium to NAV, though it may impact the investment strategy and income potential. T. Rowe Price's substantial $1.6 trillion AUM, including $20 billion in high-yield investments, suggests robust infrastructure for managing these assets post-reorganization. For current shareholders, this mandatory conversion requires careful consideration of tax implications and portfolio rebalancing needs before the February trading cessation.

Fixed Income Specialist

This reorganization carries noteworthy implications for yield-focused investors. Converting from a closed-end to an open-end fund structure typically results in reduced income potential due to the elimination of leverage capabilities. The timing of the $0.04 distribution and subsequent trading cessation on February 11 creates a clear timeline for investors to make strategic decisions. The shift to T. Rowe Price's platform, managing approximately $20 billion in high-yield investments, suggests potential benefits from economies of scale and established risk management processes. However, investors should anticipate possible changes in distribution patterns and yield characteristics post-conversion. The involvement of T. Rowe Price, with its extensive fixed-income expertise and substantial AUM of $1.6 trillion, provides some reassurance regarding the continuation of professional high-yield management, though the investment approach may differ from the Fund's historical strategy.

BOSTON, Jan. 02, 2025 (GLOBE NEWSWIRE) -- The New America High Income Fund, Inc. (the “Fund”) (NYSE: HYB) announced today that it will pay a distribution of $0.04 per share on the company’s common stock on January 31, 2025 to common shareholders of record as of the close of business on January 17, 2025. The ex-dividend date will be January 17th.

Additionally, as previously announced, the reorganization of the Fund into the T. Rowe Price High Yield Fund (the “T. Rowe Price Fund”), a separate series of the T. Rowe Price High Yield Fund, Inc. (the “Reorganization”) is expected to become effective following the close of business of the New York Stock Exchange on Friday, February 21, 2025, subject to satisfaction of customary closing conditions. Upon the closing of the Reorganization, shareholders of the Fund will become holders of Investor Class shares of the T. Rowe Price Fund.

To facilitate the Reorganization, all shares of the Fund will cease trading on the New York Stock Exchange after the market closes on February 11, 2025.

The Fund has released updated portfolio data which can be found on the Fund’s website at www.newamerica-hyb.com.

The New America High Income Fund, Inc. is a diversified, closed-end management investment company with a leveraged capital structure. The Fund’s investment adviser is T. Rowe Price Associates, Inc. (“T. Rowe Price”). As of September 30, 2024, T. Rowe Price and its affiliates managed approximately $1.6 trillion of assets, including approximately $20 billion of “high yield” investments. T. Rowe Price has provided investment advisory services to investment companies since 1937.

Contact:
Ellen E. Terry, President
Telephone: 617-263-6400
www.newamerica-hyb.com

FAQ

When will HYB stock cease trading on the NYSE?

HYB stock will cease trading on the New York Stock Exchange after the market closes on February 11, 2025.

What is the amount and date of HYB's final distribution?

HYB will pay a distribution of $0.04 per share on January 31, 2025, to shareholders of record as of January 17, 2025.

When will the HYB reorganization into T. Rowe Price High Yield Fund be completed?

The reorganization is expected to be completed following the close of business on the NYSE on February 21, 2025.

What will happen to HYB shareholders after the reorganization?

HYB shareholders will become holders of Investor Class shares of the T. Rowe Price High Yield Fund.

What is the ex-dividend date for HYB's final distribution?

The ex-dividend date for HYB's final distribution is January 17, 2025.