Virtus Total Return Fund Inc. Announces Preliminary Results of Tender Offer

Rhea-AI Summary

Virtus Total Return Fund Inc. (NYSE: ZTR) announced preliminary results of a tender offer to acquire 10% of its outstanding shares, with 23,600,666.85 shares tendered. The oversubscribed offer will lead to prorated purchases at 98% of the Fund's net asset value per share.

Financial Analyst

The Virtus Total Return Fund's recent tender offer to repurchase 10% of its outstanding shares is a strategic move that not only impacts the fund's capital structure but also has implications for its shareholders' value. Notably, the offer was oversubscribed, indicating a higher demand from shareholders to sell back their shares than the fund had anticipated. This leads to a prorated purchase, meaning that the fund will buy a proportionate amount of shares from each investor who tendered, rather than the full amount. The purchase price being 98% of the net asset value (NAV) suggests a slight discount to the closing NAV, which could be interpreted in several ways. For investors, this might be seen as an opportunity to liquidate their holdings at a near-fair value, potentially due to a desire for liquidity or a perceived better investment opportunity elsewhere. For the fund, buying back shares at a slight discount could be immediately accretive to the NAV for the remaining shareholders, as the total number of shares outstanding will decrease, thereby increasing the value of the shares that are not tendered. However, the large scale of the tender offer and high participation could also suggest shareholder dissatisfaction with the fund's performance or management. The final results, including the exact proration and the impact on the fund's NAV, will be important for understanding the complete consequences of this tender offer.

HARTFORD, Conn.--(BUSINESS WIRE)-- Virtus Total Return Fund Inc. (NYSE: ZTR) (“the Fund”) today announced preliminary results of its tender offer (“Tender Offer”) to acquire 10% of the Fund’s outstanding shares, which expired on May 1, 2024 at 5 p.m. (Eastern).

Approximately 23,600,666.85 shares were tendered, including shares tendered pursuant to notices of guaranteed delivery, based on preliminary information. With the Tender Offer oversubscribed, the relative number of shares that will be purchased from each tendering shareholder will be prorated based on the number of shares properly tendered.

The purchase price of the properly tendered and accepted shares will be equal to 98% of the Fund’s net asset value per share as of the close of regular trading on May 2, 2024. The Fund expects to announce the final results of the Tender Offer on or about May 7, 2024.

About the Fund

Virtus Total Return Fund Inc. is a diversified closed-end fund whose investment objective is capital appreciation, with income as a secondary objective. Virtus Investment Advisers, Inc. is the investment adviser and Duff & Phelps Investment Management Co. and Newfleet Asset Management are the subadvisers to the Fund. For more information on the Fund, contact shareholder services at (866) 270-7788, by email at closedendfunds@virtus.com, or through the Closed-End Funds section of 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 NAV. 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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240502416789/en/

Shareholder Services

(866) 270-7788

closedendfunds@virtus.com

Source: Virtus Total Return Fund Inc.

FAQ

What did Virtus Total Return Fund Inc. announce?

Virtus Total Return Fund Inc. announced preliminary results of a tender offer to acquire 10% of its outstanding shares.

When did the Tender Offer expire?

The Tender Offer expired on May 1, 2024 at 5 p.m. (Eastern).

What was the number of shares tendered?

Approximately 23,600,666.85 shares were tendered.

How will the purchase price be determined?

The purchase price of the properly tendered and accepted shares will be equal to 98% of the Fund’s net asset value per share as of the close of regular trading on May 2, 2024.

When will the final results of the Tender Offer be announced?

The Fund expects to announce the final results on or about May 7, 2024.