Evergreen Announces Changes to Closed End Fund Product Line
March 15, 2007 |
Press Release |
BOSTON – The Board of Directors of the Evergreen Funds approved the following proposals at a meeting held today:
- Investment strategy and name change for Evergreen Managed Income Fund (AMEX:ERC)
- Clarification of the Preferred Share Voting Standard in the Declarations of Trust for the closed end funds: Evergreen Managed Income (AMEX:ERC), Evergreen Income Advantage (AMEX:EAD) and Evergreen Utilities and High Income (AMEX:ERH)
Effective May 14, 2007, the investment strategy for Evergreen Managed Income Fund will be changed to allow the Fund’s portfolio manager greater flexibility to allocate among the three sectors the Fund emphasizes: high yield bonds, adjustable rate mortgages and international bonds. The Fund currently utilizes a fixed allocation approach of 50 percent high yield bonds, 25 percent adjustable rate mortgages and 25 percent international bonds. Under the new policy, the allocation for each sector will not be fixed. The allocation range for each sector may be between 20-60 percent. This modification will provide management with increased flexibility in seeking to meet the fund's objective of providing a high level of current income consistent with limiting its overall exposure to domestic interest rate risk.
Also, effective May 14, 2007, the Fund’s name will be changed to Evergreen Multi-Sector Income Fund, which is more reflective of its new investment strategy. Bob Calhoun, chief investment officer of Evergreen affiliate Tattersall Advisory Group (TAG), will be assigned as lead manager of the Fund and will assume leadership of the Fund’s asset allocation strategy.
Calhoun will continue to manage the Fund in accordance with its BBB average credit quality, intermediate maturity and intermediate duration guidelines using a similar allocation approach used to manage other TAG multi-discipline fixed income strategies (Core Plus, Diversified Bond, Strategic Income). In allocating among the three strategies, Calhoun will continue to seek attractive levels of income and reduced sensitivity to domestic interest rates through a diversified portfolio of fixed income securities. Calhoun will work closely with the managers of the underlying high yield, adjustable rate and international bond portfolios that comprise the Fund regarding asset allocation decisions.
The Trustees have also approved a proposal to clarify preferred share class voting rights language as stated in the Declaration of Trust for three of Evergreen’s closed end funds: Managed Income, Income Advantage and Utilities and High Income. Each Holder of Preferred Shares shall be entitled to equal voting rights with holders of Common Shares for each share of Preferred Shares held by such Holder on each matter submitted to a vote of shareholders of the Fund. The revised language will apply to all future shareholder votes.
Investment return and principal value of an investment will fluctuate so
that investors' shares, when sold, may be worth more or less than their
original costs. The fund has issued preferred shares and, in addition, may
borrow, which creates leverage. The use of leverage results in certain risks
including, among others, the likelihood of greater volatility of net asset
value and the market price of common shares. Foreign investments may contain
more risk due to the inherent risks associated with changing political
climates, foreign market instability and foreign currency fluctuations.
Derivatives involve additional risks including interest rate risk, credit risk,
the risk of improper valuation and the risk of non-correlation to the relevant
instruments they are designed to hedge or to closely track. High yield,
lower-rated bonds may contain more risk due to the increased possibility of
default. The return of principal is not guaranteed due to fluctuation in the
fund's NAV caused by changes in the price of individual bonds held by the fund
and the buying and selling of bonds by the fund. Bond funds have the same
inflation, interest rate and credit risks as individual bonds. Generally, the
value of bond funds rise when prevailing interest rates fall, and fall when
interest rates rise. U.S. government guarantees apply only to certain
securities held in the fund's portfolio and not to the fund's shares.
About Evergreen Investments
Evergreen Investments is the brand name under which Wachovia Corporation
(NYSE:WB) conducts its investment management business. Wachovia Global Asset
Management is the brand name under which Evergreen Investments conducts sales
and distribution business outside of the United States. Combined, the groups
serve more than four million individual and institutional investors through a
broad range of investment products. Led by more than 300 investment
professionals, Evergreen Investments strives to meet client investment
objectives through disciplined, team-based asset management. Evergreen
Investments manages more than $273 billion in assets (as of December 31, 2006).
For more information on Evergreen, please visit EvergreenInvestments.com.
Source:Evergreen Investments
Media Inquiries:
Laura Fay: 617.210.3867, lfay@EvergreenInvestments.com
Dan Flaherty: 617.210.3887, dflaherty@EvergreenInvestments.com
Shareholder Inquiries: 800.343.2898