MFS funds plan tender offers for auction-rate preferreds at 95% of par

By Susanna Moon

Chicago, July 6 - MFS Municipal Income Trust, MFS Investment Grade Municipal Trust, MFS California Municipal Fund, MFS High Income Municipal Trust and MFS High Yield Municipal Trust will begin tender offers for their outstanding auction-rate preferred shares.

The board of trustees of each fund authorized the tender offer for the auction-rate preferreds at a price of 95% of the liquidation preference of $25,000 per share, or $23,750 per share, plus accrued dividends through the expiration date of the tender offer, according to a press release by Boston-based MFS Investment Management.

More details of the offers, including timing, will be announced later.

Each fund's tender offer will be conditioned on the receipt of tenders for at least 70% of its outstanding auction-rate preferreds, the private placement of new preferred shares and the approval by holders of an amendment to each fund's bylaws to replace Standard & Poor's with Fitch as a rating agency for the preferreds.

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