(Source: Business Wire)
First Trust Advisors L.P. ("First Trust") today announced that the Board of Trustees of First Trust Strategic High Income Fund (NYSE: FHI), First Trust Strategic High Income Fund II (NYSE: FHY) and First Trust Strategic High Income Fund III (NYSE: FHO) has voted to approve Hyperion Brookfield Asset Management, Inc. ("Hyperion") as investment sub-advisor to the Funds, replacing Valhalla Capital Partners, LLC. Each Fund has entered into an interim investment sub-advisory agreement with First Trust and Hyperion, as investment sub-advisor, effective on June 29, 2009. The interim sub-advisory agreements will remain in effect until the earlier of November 26, 2009 or until a new sub-advisory agreement is approved by the shareholders of each Fund.
Subject to shareholder approval, the Board of Trustees of each Fund has also approved a change in each Fund's industry concentration policy to provide that each Fund may not purchase any security if, as a result of the purchase, 25% or more of the Fund's total assets (taken at current value) would be invested in the securities of borrowers and other issuers having their principal business activities in the same industry. Currently, each Fund's industry concentration policy states that it will invest at least 25% of its total assets in residential mortgage-backed securities under normal market conditions.
Shareholders of FHI, FHY and FHO will be asked to vote on a proposal to approve the new investment sub-advisory agreements with Hyperion as well as the above-referenced proposal to change the industry concentration policy for each Fund at a joint special meeting of shareholders. Any solicitation of proxies made in connection with this shareholder meeting will only be made pursuant to separate proxy materials filed with the U.S. Securities and Exchange Commission ("SEC") under applicable federal securities laws. There can be no assurance that the necessary percentage of the shareholders of each Fund will vote to approve Hyperion as the new investment sub-advisor or the change in the industry concentration policy.
The Board of Trustees of FHI also approved a change in investment policy so that FHI may invest up to 100% of its managed assets in below-investment grade debt securities (commonly referred to as "high-yield" or "junk" bonds). This investment policy is non-fundamental and therefore may be changed by approval of the Board of Trustees without shareholder approval. The investment policy will be effective on or about September 1, 2009.
