The Phaserl


It Begins – Managed High Yield Bond Fund Liquidates After 17 Years

from Zero Hedge:

Since inception in June 1998, UBS’ Managed High Yield Plus Fund survived through the dot-com (and Telco) collapse and the post-Lehman credit carnage but, based on the press release today, has been felled by the current credit cycle’s crash. After 3 years of trading at an increasingly large discount to NAV, and plunging to its worst levels since the peak of the financial crisis, the board of the Fund has approved a proposal to liquidate the Fund. While timing is unclear, this is the worst case for an increasingly fragile cash bond market as BWICs galore are set to hit with “liquidty thin to zero.”

It’s Over… (as The Fund Statement reads):

Managed High Yield Plus Fund Inc. (the “Fund”) (NYSE:HYF) announced today that the Board of Directors (the “Board”) of theFund has approved a proposal to liquidate the Fund in 2016, subject to shareholder approval.


After careful deliberation and a thorough review of the available alternatives, and based upon the recommendation of UBS Global Asset Management (Americas) Inc. (“UBS AM”), the Fund’s manager, the Board has determined that liquidation and dissolution of the Fund is in the best interests of the Fund. A proposed plan of liquidation will be submitted for the approval of the Fund’s shareholders at a special shareholders meeting of the Fund, which will be scheduled to be held in April 2016. If the shareholders approve the proposed plan, the liquidation and dissolution of the Fund will take place as soon as reasonably practicable, but in no event later than December 31, 2016 (absent unforeseen circumstances).


Further information regarding the liquidation proposal, including the plan of liquidation, will be included in the proxy materials that will be mailed to the Fund’s shareholders in advance of the shareholders meeting.

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This is a nightmare for the corporate credit market, where, as we noted previously “liquidity is thin to zero.”…

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