A four-star Virtus [see profile] fund may soon be swallowed by a five-star one. Yesterday the Hartford, Connecticut-based mutual fund firm revealed plans to merge the $79.3-million Virtus Intermediate Tax-Exempt Bond Fund into the $137.9-million Virtus Tax-Exempt Bond Fund [see filing].

A Virtus spokesman was not immediately able to comment on the move.

In a letter to be sent to the funds' shareholders, Virtus explained that the merger (which will be paid for by Virtus) should "result in greater operating efficiencies [i.e. lower costs] for shareholders of Intermediate Tax-Exempt Bond".

Pending shareholder approval at a meeting on September 16, the funds are slated to merge on September 23. Both funds are PMed by Michael Janik and George Selby. 

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