MFS to partially redeem auction preferred shares of two closed-end funds

By Cristal Cody

Springdale, Ark., July 23 - MFS Investment Management announced Wednesday that two of its closed-end funds, MFS Investment Grade Municipal Trust and MFS High Yield Municipal Trust, will redeem a percentage of auction preferred shares.

The MFS High Yield Municipal Trust will redeem $15 million, or 16.67% of outstanding shares, on Aug. 21.

The MFS Investment Grade Municipal Trust will redeem $11.25 million, or 18.75% of outstanding shares, on Aug. 22.

The funds will finance the redemptions through tender option bonds.

MFS also expects in the future to partially refinance outstanding auction shares from two other closed-end funds, the MFS Municipal Income Trust and MFS High Income Municipal Trust, with tender option bonds.

MFS does not plan to use tender option bonds to refinance auction shares from the MFS California Insured Municipal Fund because of higher risks.

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