Mavrix Fund Management Inc. is seeking a six-month extension of the period in which the Mavrix Growth Fund must reduce the proportion of illiquid securities it holds, the company announced on Tuesday.

Securities legislation requires that the company reduce the amount of private investments held by the fund to below 15% of the net assets by March 3. The company is filing an application with the Canadian securities administrators to extend this deadline to Sept. 30.

“There can be no assurance that such extension will be granted,” the company stated.

The fund has not purchased any securities that were illiquid at the time of purchase since Sept. 14, 2007, according to Mavrix. On Dec. 3, 2008, the fund exceeded the 15% illiquid security threshold as a result of continuing net redemptions and deteriorating market conditions.

The fund has been using “reasonable commercial efforts” to reduce its investments in private companies, but as of March 3, such investments remain in excess of the 15% limit. As at Feb. 27, 2009, illiquid securities comprised 27.9% of the Fund’s net assets. Its illiquid securities represent the securities of two issuers, with one representing 18.4% and the other 9.5% of the fund’s net assets.

Mavrix said it is confident that the illiquid security component of the fund’s portfolio can be reduced to below the required 15% threshold by Sept. 30. It added that it does not foresee any difficulty in satisfying unitholder redemption requests.

The fund’s investment objective is to provide long-term capital growth by investing primarily in equity securities of Canadian companies, with an emphasis on small capitalization companies.