Evergreen Investments today announced plans by the firm’s parent company, Wachovia Corporation, to purchase the Lehman debt held in Evergreen Money Market Fund, Evergreen Institutional Money Market Fund, and Evergreen Prime Cash Management Fund. Evergreen anticipates the purchase would be complete on or about 1 October 2008. As of 15 September 2008, the Funds had combined total net assets of $29 billion and $494 million in total Lehman credit exposure.
Earlier this month, Wachovia had entered into support agreements with Evergreen Money Market Fund, Evergreen Institutional Money Market Fund, and Evergreen Prime Cash Management Fund in order to support the value of Lehman credit held in the Funds, and to prevent a decrease in the net asset value (NAV) of those Funds due to the Lehman debt. Wachovia has now decided to purchase the Lehman debt holdings out of the Funds.
In addition, Evergreen confirmed that it had submitted the necessary documentation and paid the required fee to participate in the Money Market Guarantee Program established by the U.S. Treasury Department. According to information published by the Treasury, the program will guarantee the share price of any publicly offered eligible money market mutual fund that applies for and pays a fee to participate in the program. Money market mutual funds that are regulated under Rule 2a-7 of the Investment Company Act of 1940, that maintain a stable share price of $1.00, and that are publicly offered and registered with the Securities and Exchange Commission are eligible to participate in the program. The Guarantee Program provides coverage to shareholders for amounts held in participating money market funds as of the close of business on September 19, 2008.
D.C.