NEW YORK, Nov. 26, 2008 (GLOBE NEWSWIRE) -- PIMCO High Income Fund (NYSE:PHK), PIMCO Floating Rate Income Fund (NYSE:PFL) and PIMCO Floating Rate Strategy Fund (NYSE:PFN) (each, a "Fund" and collectively, the "Funds") today announced that each Fund will redeem, at par, a portion of its auction rate preferred shares ("ARPS"), beginning December 15, 2008 for PHK and PFN and beginning December 17, 2008 for PFL and concluding for all Funds on December 19, 2008. These redemptions are in addition to the partial redemptions announced for the Funds on November 19, 2008.
A Fund is not permitted to pay or declare common share dividends unless the Fund's ARPS have a minimum asset coverage of 200% ("200% Level") after payment or declaration of the common share dividends, in accordance with the Investment Company Act of 1940, as amended and each Fund's By-laws. Continued severe market dislocations have caused the values of the Funds' portfolio securities to decline, and as a result the Funds' asset coverage ratios have fallen below the 200% Level.
The decision to redeem an additional portion of the Funds' ARPS was made at the recommendation of the Funds' managers and approved by the Boards of Trustees. This additional redemption is intended to increase and maintain asset coverage of the Funds' ARPS above the 200% Level, permitting the Funds to pay the previously declared October common share dividends and to declare and pay future common share dividends. Depending on market conditions, these coverage ratios may increase or decrease further. An announcement regarding actual dividend payment and declaration dates will be made at a future date.
Each Fund intends to redeem the following amount of ARPS per Series, at their full liquidation preference of $25,000 per share plus accumulated but unpaid dividends, up to their respective dates of redemption:
PIMCO High Income Fund (PHK)
------------- ---------------- ----------------- ---------------
Series Redemption Date Redemption Amount Redemption Amount
as a % of
Outstanding ARPS
in that Series(1)
------------- ---------------- ----------------- ---------------
Series M Dec. 16, 2008 $24,600,000 13.7%
(CUSIP: (984 shares
722014206) x $25,000)
------------- ---------------- ----------------- ---------------
Series T Dec. 17, 2008 $24,600,000 13.7%
(CUSIP: (984 shares
722014305) x $25,000)
------------- ---------------- ----------------- ---------------
Series W Dec. 18, 2008 $24,600,000 13.7%
(CUSIP: (984 shares
722014404) x $25,000)
------------- ---------------- ----------------- ---------------
Series TH Dec. 19, 2008 $24,600,000 13.7%
(CUSIP: (984 shares
722014503) x $25,000)
------------- ---------------- ------------------ ---------------
Series F Dec. 15, 2008 $24,600,000 13.7%
(CUSIP: (984 shares
722014602) x $25,000)
------------- ---------------- ------------------ ---------------
Total $123,000,000
(4,920 shares
x $25,000)
------------- ---------------- ------------------- ---------------
PIMCO Floating Rate Income Fund (PFL)
--------------- ---------------- ------------------ ---------------
Series Redemption Date Redemption Amount Redemption Amount
as a % of
Outstanding ARPS
in that Series(1)
--------------- ---------------- ------------------ ---------------
Series T Dec. 17, 2008 $6,000,000 Approx. 8.6%
(CUSIP: (240 shares
72201H207) x $25,000)
--------------- ---------------- ------------------ ---------------
Series W Dec. 18, 2008 $6,000,000 Approx. 8.6%
(CUSIP: (240 shares
72201H306) x $25,000)
--------------- ---------------- ------------------ ---------------
Series TH Dec. 19, 2008 $6,000,000 Approx. 8.6%
(CUSIP: (240 shares
72201H405) x $25,000)
--------------- ---------------- ------------------ ---------------
Total $18,000,000
(720 shares
x $25,000)
--------------- ---------------- ------------------ ---------------
PIMCO Floating Rate Strategy Fund (PFN)
--------------- ---------------- ------------------ -----------------
Series Redemption Date Redemption Amount Redemption Amount
as a % of
Outstanding ARPS
in that Series(1)
--------------- ---------------- ------------------ -----------------
Series M Dec. 16, 2008 $7,400,000 Approx. 7.7%
(CUSIP: (296 shares
72201J500) x $25,000)
--------------- ---------------- ------------------ -----------------
Series T Dec. 17, 2008 $7,400,000 Approx. 7.7%
(CUSIP: (296 shares
72201J203) x $25,000)
--------------- ---------------- ------------------ -----------------
Series W Dec. 18, 2008 $7,400,000 Approx. 7.7%
(CUSIP: (296 shares
72201J302) x $25,000)
--------------- ---------------- ------------------ -----------------
Series TH Dec. 19, 2008 $7,400,000 Approx. 7.7%
(CUSIP: (296 shares
72201J401) x $25,000)
--------------- ---------------- ------------------ -----------------
Series F Dec. 15, 2008 $7,400,000 Approx. 7.7%
(CUSIP: (296 shares
72201J609) x $25,000)
--------------- ---------------- ------------------ -----------------
Total $37,000,000
(1,480 shares
x $25,000)
--------------- ---------------- ------------------ -----------------
(1) Exclusive of amounts previously scheduled for redemption.
The Funds are partially redeeming their ARPS on a pro rata basis by Series. The Depositary Trust Company ("DTC"), holder of record of the ARPS, determines how the redemption will be allocated among each participant broker-dealer account that holds ARPS and each participant broker-dealer determines how to allocate each redemption among the beneficial holders of the ARPS held by it. The procedures used by participant broker-dealers to allocate redeemed ARPS among their clients may differ from each other and from the procedures used by DTC.
PHK's investment objective is to seek high current income. Capital appreciation is a secondary objective. PFL's and PFN's investment objective is to seek high current income, consistent with the preservation of capital.
Allianz Global Investors Fund Management LLC, an indirect, wholly-owned subsidiary of Allianz Global Investors of America L.P., serves as the Funds' investment manager and is a member of Munich-based Allianz Group (NYSE:AZ). Pacific Investment Management Company LLC, an Allianz Global Investors Fund Management affiliate, serves as the Funds' sub-adviser.
The Funds' daily New York Stock Exchange closing prices and net asset values per share are available by calling the Funds' shareholder servicing agent at (800) 331-1710. This information, as well as updated portfolio statistics and performance, is available at http://www.allianzinvestors.com.
Statements made in this release that look forward in time involve risks and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such risks and uncertainties include, without limitation, the adverse effect from further declines in the securities markets and in the Funds' performance, a general downturn in the economy, inability to obtain leverage to replace ARPS that have been redeemed, competition from other companies, changes in government policy or regulation, inability to attract or retain key employees, inability to implement its operating strategy and/or acquisition strategy, and unforeseen costs and other effects related to legal proceedings or investigations of governmental and self-regulatory organizations. The Funds' ability to pay dividends to common shareholders is subject to the restrictions in their registration statements, By-laws and other governing documents.