The Securities Commission approved a reorganization of certain investment funds managed by Mackenzie Financial Corporation, subject to conditions. The reorganization involved the merging of various series of Mackenzie funds with corresponding Canada Life Funds, which did not meet all pre-approval criteria due to tax implications and the lack of immediate wind-up of the reorganizing funds.
The Commission granted exemptions to allow the new reorganized funds to invest in foreign government securities beyond the standard concentration limits, provided these securities are highly rated and the investment aligns with the funds’ objectives. Additionally, the Commission permitted top funds to invest in reorganized and continuing funds that hold more than 10% of their net asset value in securities of a fund established for tax deferral purposes post-reorganization.
The decision was based on the funds’ compliance with National Instrument 81-102 Investment Funds, except for certain criteria, and the belief that the reorganization would be in the best interests of the funds and their unitholders. The reorganization was structured to be tax-efficient and to avoid triggering significant capital gains. The Commission’s approval was contingent on unitholder approval and adherence to specified conditions to ensure transparency and avoid fee duplication.