Manulife Mutual Funds Streamlines Fund Line-up with Proposed Mergers
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TORONTO, July 24, 2014 /CNW/ - Manulife Mutual Funds is committed to sustaining a strong and efficient product line-up to serve investors' needs. As such, Manulife Mutual Funds will make a number of changes to its fund offerings, including implementing certain fund mergers, a portfolio manager change, a fund name change and risk rating changes, subject to the receipt of all necessary regulatory and securityholder approvals.
Manulife Mutual Funds announced plans today for a number of fund mergers. Manulife Mutual Funds intends to merge four funds on or about October 24, 2014, followed by mergers of 11 funds on or about November 7, 2014. These mergers are designed to simplify Manulife Mutual Funds' investment platform, remove sub-scale products, and manage Manulife Investment Exchange Funds Corp. ("MIX Corp.") in response to the federal government enacted legislation to eliminate the use of derivative forward agreements to re-characterize fully taxable income into capital gains for tax purposes.
"It's important that we respond to last year's Federal Budget announcement in a manner that is in the best interest of all investors in funds within the MIX Corp. With the elimination of forward contracts for income character conversion purposes, we are removing certain assets which are generating significant fully taxable income from MIX Corp. to the trust-equivalent funds in the best interest of the affected investors and to help ensure a strong, viable corporation for our investors, for years to come." said Derek Saliba, AVP, Mutual Funds, Manulife.
October 24, 2014 Fund Mergers (after the close of business on or about October 24, 2014, the "Merger Date")
Manulife Mutual Funds has received from its Independent Review Committee the approval or recommendation for approval, as required, to proceed with plans for mergers of the following funds.
|Terminating Fund||Continuing Fund|
|Manulife Global Opportunities Balanced Fund||Manulife Global Strategic Balanced Yield Fund|
|Manulife Global Opportunities Class||Manulife Global Dividend Class|
|Manulife International Value Equity Class||Manulife International Value Equity Fund|
|Manulife Preferred Income Fund||Manulife Preferred Income Class|
November 7, 2014 Fund/Pool Mergers (after the close of business on or about November 7, 2014, the "Merger Date")
Manulife Mutual Funds has received from its Independent Review Committee the approval or recommendation for approval, as required, to proceed with plans for mergers of the following funds and pools.
|Terminating Fund||Continuing Fund|
|Manulife Strategic Income Class*||Manulife Strategic Income Fund|
|Manulife Yield Opportunities Class*||Manulife Yield Opportunities Fund|
|Manulife Floating Rate Income Class*||Manulife Floating Rate Income Fund|
|Manulife Structured Bond Class*||Manulife Canadian Conservative Balanced Fund|
|Manulife Corporate Bond Class*||Manulife Corporate Bond Fund|
|Manulife Strategic Balanced Yield Class*||Manulife Strategic Balanced Yield Fund|
|Manulife U.S. Balanced Private Pool* (formerly Manulife Balanced Private Pool)||Manulife U.S. Balanced Private Trust (formerly Manulife Balanced Private Trust)|
|Manulife Balanced Income Private Pool*||Manulife Balanced Income Private Trust|
|Manulife Global Fixed Income Private Pool*||Manulife Global Fixed Income Private Trust|
|Manulife Canadian Fixed Income Private Pool*||Manulife Canadian Fixed Income Private Trust|
|Manulife Corporate Fixed Income Private Pool*||Manulife Corporate Fixed Income Private Trust|
*This class/pool has been capped to all new purchases as of April 9, 2013.
Each securityholder of a Terminating Fund and select Continuing Funds will receive advance notice of the mergers through a Notice of Termination or, in the case of those mergers that require securityholder approval, a Notice of Meeting and Management Information Circular, in accordance with applicable securities laws. Approval by securityholders of each of the following Continuing Funds: Manulife Preferred Income Class, Manulife Canadian Conservative Balanced Fund, Manulife Global Dividend Class, and Manulife Balanced Income Private Trust will also be required. Any necessary securityholder approvals would be sought at special meetings to be held on or about October 16, 2014 for securityholders of record as of September 8, 2014.
Each proposed merger will be effected on a taxable basis, with the exception of the mergers of Manulife Global Opportunities Balanced Fund and Manulife Global Opportunities Class, which will each be executed on a tax-deferred basis. Each of the taxable mergers will require regulatory approval, as well as securityholder approval of the Terminating Funds.
Each Terminating Fund is intended to be wound-up or terminated as soon as possible after completion of its merger and, therefore, until then is expected to be transitioning its investment portfolio in preparation for such merger.
Ceasing Distribution of New Securities
As of the close of business on or about July 30, 2014, the following funds will cease distribution of new securities. Securityholders will have the right to redeem the securities of each Terminating Fund up to the close of business on the effective date of each merger.
- Manulife Global Opportunities Balanced Fund
- Manulife Global Opportunities Class
- Manulife International Value Equity Class
- Manulife Preferred Income Fund
In addition, effective on or about July 30, 2014, Manulife Mutual Funds will cease distribution of new securities for Manulife Tax-Managed Growth Fund. Current securityholders can continue to hold their units in Manulife Tax-Managed Growth Fund.
Upon these funds ceasing distribution of new securities, any ongoing purchases through pre-authorized chequing plans, Group Plan Purchases and RESP incentives will be directed to a money market fund managed by Manulife Mutual Funds, unless securityholders advise us otherwise.
Portfolio Manager and Investment Strategy Change
Effective on or about August 1, 2014, Terry Carr, Senior Managing Director & Head of Canadian Fixed Income, Manulife Asset Management, will become the lead Portfolio Manager for the Manulife Balanced Income Private Trust, replacing the Portfolio Solutions Group.
Mr. Carr is Head of Canadian Fixed Income for Manulife Asset Management. He is responsible for the Canadian Fixed Income and Money Market teams. Mr. Carr is also a senior member of the Manulife Asset Management Investment Committee. At the same time, the investment strategy of the Manulife Balanced Income Private Trust will be changed to enable Mr. Carr to use an actively managed strategy that tactically allocates amongst different Canadian and/or global fixed income and equity asset classes.
Fund Name Change
Effective on or about August 1, 2014, Manulife Global Dividend Income Fund will have its name changed to Manulife Global All Cap Focused Fund. This name change more closely reflects the investment strategy of the fund.
Risk Rating Changes
Effective on or about August 1, 2014, the risk ratings of Manulife Global Real Estate Fund and Manulife Global Real Estate Class are changing from "high" to "medium to high".
The change in risk rating will be reflected in this year's Simplified Prospectus of each fund which will be filed with Canadian Securities Regulators on or about August 1, 2014.
The Investment Funds Institute of Canada established guidelines for determining risk ratings based primarily upon the volatility of returns for a mutual fund. Based on these guidelines, Manulife Mutual Funds determined it was appropriate to lower the risk rating for Manulife Global Real Estate Fund and Manulife Global Real Estate Class from "high" to "medium to high". No changes have been made to the investment objectives, strategies or management of these funds.
For more information, please contact Manulife Customer Service at 1-888-588-7999 for English and 1-877-426-9991 for French.
About Manulife Mutual Funds
Manulife Mutual Funds, a division of Manulife Asset Management Limited, builds on 125 years of Manulife Financial's wealth and investment management expertise in managing assets for Canadian investors, through a diverse portfolio of forward-thinking mutual fund products. Our experienced Portfolio Managers offer access to markets in Canada, the United States and around the world, in a range of investment styles to help meet individual needs. Manulife Mutual Funds is part of Manulife Investments, which offers personal wealth management products and services, such as mutual funds, segregated fund contracts, annuities and guaranteed interest contracts. For more information, please visit manulifemutualfunds.ca.
About Manulife Asset Management
Manulife Asset Management is the global asset management arm of Manulife Financial, providing comprehensive asset management solutions for institutional investors and investment funds in key markets around the world. This investment expertise extends across a broad range of public, private, and alternative asset classes, as well as asset allocation solutions. As at March 31, 2014, assets under management for Manulife Asset Management were C$298 billion (US $269 billion). Additional information about Manulife Asset Management may be found at ManulifeAM.com.
Manulife is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife and its subsidiaries were approximately C$635 billion (US$574 billion) as at March 31, 2014. Our group of companies operates as Manulife in Canada and Asia and primarily as John Hancock in the United States.
Manulife Financial Corporation trades as 'MFC' on the TSX, NYSE and PSE, and under '945' on the SEHK. Manulife can be found on the Internet at manulife.com.
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