Mackenzie Financial Services Inc. unveiled another phase of fund mergers Friday. The five proposed mergers will be considered at special unitholder meetings to be held on May 1.
In three of five proposed mergers, Mackenzie will merge each original underlying fund with the fund’s Capital Class version. Mackenzie Capital Class Funds, also referred to as “switch funds,” offer the same benefits as their underlying funds, but with a tax-efficient structure.
Mackenzie Universal Financial Services Fund will be merged into Mackenzie Universal Financial Services Capital Class. The fund’s investment mandate and portfolio team will remain unchanged. Co-managed by DWS Asset Management, UBS Global Asset Management and United Overseas Bank, the fund will continue to focus primarily on large, well-capitalized, global financial companies with a bias towards banking and insurance, and diversify by investing in some regional businesses to leverage attractive valuations.
Investors in Mackenzie Universal RSP Financial Services Fund will also be asked to approve a change of investment objective, such that the fund will closely track Mackenzie Universal Financial Services Capital Class instead of the original underlying foreign fund.
Mackenzie Universal U.S. Emerging Growth Fund will merge into Mackenzie Universal U.S. Emerging Growth Capital Class. Grant Sarris and Mark Seferovich, of Waddell & Reed, were appointed lead managers of both funds on Dec. 16, 2002. Sarris and Seferovich lead the small-cap growth team at Waddell & Reed and have a reputation for preserving capital in declining markets and delivering consistent positive performance in rising markets. The managers aim to moderate the risk associated with small-cap growth equity market investing by balancing aggressive picks with more stable companies in steady-growth industries.
Waddell & Reed is recognized as a mutual fund leader in the United States and has been ranked among the top-ten mutual fund companies by performance over ten years in annual rankings by Barron’s.
Investors in Mackenzie Universal RSP U.S. Emerging Growth Fund will also be asked to approve a change of investment objective, such that the fund will closely track Mackenzie Universal U.S. Emerging Growth Capital Class instead of the original underlying foreign fund.
Mackenzie Ivy European Fund will merge with Mackenzie Ivy European Capital Class. Mackenzie Ivy European Capital Class will continue to focus on long-term growth and preservation of capital by investing in European companies with international operations. Jerry Javasky, Canada’s 2002 Fund Manager of the Year, and Ivy co-manager Paul Musson, will continue to manage the fund using Ivy’s research-based, company-specific approach.
Mackenzie is also proposing to merge its Mackenzie U.S. Money Market Fund into Mackenzie U.S. Managed Yield Capital Class. The Mackenzie U.S. Managed Yield Fund holds a portfolio of Canadian equities hedged to provide stable returns for investors.
Investors in the fund benefit from distributions in the form of capital gains, which are only taxed at 50 per cent as compared to the U.S. Money Market Fund, which distributes income, taxed at 100 per cent. The Mackenzie U.S. Managed Yield Capital Class fund is also four times the size of the Mackenzie U.S. Money Market Fund and Mackenzie expects that future efficiencies in the merged fund will reduce costs for unitholders.
The proposed changes will permit investors with non-registered accounts to transfer between any of one of the above four funds, and up to 34 other Mackenzie Capital Class funds, without incurring capital gains.
“In streamlining our investment line, we’ve consistently and carefully weighed proposed changes against the needs of investors,” said David Feather, president, Mackenzie Financial Services Inc. “In every case and with every change, we’ve strengthened our investment offerings and reinforced the features and benefits of each fund we offer.”
Ivy Foreign Equity Capital Class Mackenzie is also proposing to merge Universal Diversified Equity Capital Class into Ivy Foreign Equity Capital Class. The proposed fund merger follows an earlier management change announced on Nov. 19, 2002.
Information circulars with full details of the above-proposed changes will be mailed to investors later this month.
Mackenzie also announced investor approval of a recent proposed management change to Mackenzie Universal World Science and Technology Capital Class.
On March 5, investors in the fund approved the proposed resolution to appoint Brian Ashford-Russell, principal and founder of Polar Capital Partners, as sole lead manager of the fund. Ashford-Russell.
Ashford-Russell will co-manage the fund with his colleague Tim Woolley, a U.S. technology specialist. Polar Capital will assume management for the entire fund effective March 10.
Mackenzie unveils more fund mergers
- By: IE Staff
- March 7, 2003 March 7, 2003
- 15:20