Rule 497(e)
File Nos. 33-54012 and
811-7328
THE HANOVER INVESTMENT FUNDS, INC.
The Hanover Short Term U.S. Government Fund
The Hanover U.S. Government Securities Fund
The Hanover Blue Chip Growth Fund
The Hanover Small Capitalization Growth Fund
The Hanover American Value Fund
Prospectus Supplement dated March 29, 1996
In August 1995 Chemical Banking Corporation ("Chemical") and The Chase
Manhattan Corporation ("Chase") announced that they had entered into a merger
agreement. Following the merger of these two bank holding companies, The Chase
Manhattan Bank, N.A. will be merged with and into Chemical Bank, at which time
Chemical Bank will assume the Chase Manhattan name.
In anticipation of the consummation of the foregoing mergers, the Board of
Directors of The Hanover Investment Funds, Inc. (the "Company"), which is
affiliated with Chemical, and the Board of Trustees of Mutual Fund Group
("Vista"), a mutual fund company affiliated with Chase, each have approved an
Agreement and Plan of Reorganization and Liquidation (the "Agreement") to be
entered into by the Company and Vista. The Agreement provides that, subject to
certain conditions, including approval of the Agreement by the shareholders of
the Company and consummation of the merger of Chemical and Chase, each
investment portfolio of the Company listed above will sell all of its assets
and liabilities to a corresponding existing or newly-created investment
portfolio of Vista, in exchange for the issuance by Vista of shares of the
respective acquiring investment portfolio. The value of the shares of a
portfolio of Vista issued in connection with the contemplated transaction
will equal the value of the net assets of the corresponding portfolio of
the Company being sold. Each portfolio of the Company will distribute to
its shareholders the shares of a particular class or classes received from
Vista in cancellation of a corresponding class or classes of the outstanding
shares of the Company, and shareholders of the Company will become
shareholders of Vista. The total net asset value of the holdings of the
shareholders of the Company immediately before and after the contemplated
transaction will be the same. The Agreement provides that, subject to the
satisfaction of the conditions contained therein, the transaction will be
consummated before July 31, 1996.
