The Fédération des caisses Desjardins du Québec, the manager of the Desjardins family of mutual funds, announced Wednesday the proposed mergers of certain Desjardins Funds, as well as several changes to the Desjardins Alternative Investments Fund.

The proposed changes to the Desjardins Alternative Investments Fund are intended to permit enhanced portfolio diversification, the manager said. The changes would also offer the prospect of increased income by giving the manager wider discretion as to the types of securities the fund would invest in.

The new investment objective of the fund would be to provide both income and long-term capital appreciation by investing primarily, either directly or by investing in units of other mutual funds, in fixed income securities and income oriented equity securities of issuers located throughout the world. Furthermore, the objective would be to provide investors with improved diversification by focusing on asset classes that complement a portfolio made up of traditional asset classes.

If approved, Desjardins Alternative Investments Fund will change its name to reflect its new investment objective.

Desjardins is also proposing the following mergers:

1. Desjardins Northwest Specialty Global High Yield Bond Fund to be merged into Desjardins Alternative Investments Fund, contingent upon the unitholders of Desjardins Alternative Investments Fund approving the change to its investment objective;

2. Desjardins Enhanced Alternative Investments Fund to be merged into Desjardins Alternative Investments Fund, contingent upon the unitholders of Desjardins Alternative Investments Fund approving the changes to its investment objective;

3. Desjardins Northwest Specialty Equity Fund to be merged into Desjardins Canadian Small Cap Equity Fund;

4. Desjardins Fidelity True North Fund to be merged into Desjardins Canadian Equity Fund which, independent from the proposed merger, will be renamed Desjardins Canadian Equity Growth Fund.

Desjardins expects that meetings of unitholders to approve these changes and mergers will be held in March 2010. If are approved, the changes to the Desjardins Alternative Investment Fund will start to be implemented in March 2010, and the fund mergers will take effect in May 2010.