O’Leary Funds Management LP has obtained regulatory approval to proceed with the merger of closed-end O’Leary Global Income Opportunities Fund (TSX: OGO.un) with open-end mutual fund O’Leary Global Yield Opportunities Fund, O’Leary Funds said Friday.

The merger will be effected in accordance with the “permitted merger” provisions set out in the declaration of trust of the closed-end fund dated Jan, 29, 2009.

As a result, the the closed-end fund will permit the withdrawal of any redemption election with respect to trust units of the fund submitted by a unitholder during the most recent annual redemption notice period. The deadline to submit such withdrawal notice in writing is 10:00 ET. on Friday, July 16. Unitholders who wish to withdraw their redemption election should contact their investment advisor.

The investment objectives of O’Leary Global Yield Opportunities Fund will be to invest globally primarily in publicly-traded corporate bonds, convertible debt securities, preferred shares and dividend-paying equity securities of issuers having market capitalizations of at least $1 billion in order to maximize total return for unitholders consisting of interest and dividend income and capital appreciation. The mutual fund will seek to provide unitholders with periodic distributions in accordance with the distribution policy established for each series.

The merger will be implemented on a tax deferred basis. Unitholders of the closed-end fund will receive units of the mutual fund in exchange for their units. The exchange ratio will be determined by the O’Leary Funds with reference to NAV per unit of the Fund as at close of business on August 13, and an initial issue price of $10 per one unit of the mutual fund. The exchange ratio will be announced by O’Leary Funds at a later date.

Investors in the closed-end fund will not experience any change in the management fee as a result of the merger, O’Leary Funds said.

After the merger, O’Leary Global Yield Opportunities Fund will distribute $0.60 per year representing an annual distribution of 6% based on the anticipated $10 per unit issue price, which corresponds to a regular monthly distribution of $0.05 per unit.

Once the merger is completed on or about August 16, 2010, subscriptions for additional investments and redemptions of O’Leary Global Yield Opportunities Fund will be made via FundSERV.

O’Leary Funds believes that the merger will provide investors with enhanced liquidity and pricing by providing them with the continuous right to subscribe for additional units or redeem units on a daily basis. Unitholders of O’Leary Global Yield Opportunities Fund will also be able to switch from their units into other series offered by the fund and into other mutual funds offered by the O’Leary Funds. Unitholder accounts which are deemed to be non-resident of a Canadian province will not be allowed to hold units of the O’Leary Global Yield Opportunities Fund d and accordingly, will be redeemed shortly after the merger is completed.

O’Leary Funds will file all required amendments to the simplified prospectus and annual information form of O’Leary Global Yield Opportunities Fund in the coming days in order to ensure that the fund’s investment objectives and strategies are similar to those of the closed-end fund and to create a new series of units which will be exchanged for trust units of the closed-end fund.