TORONTO, April 10, 2013 /CNW/ - Connor, Clark & Lunn Financial Opportunities Fund ("GFO") announced today that the board of directors of Connor, Clark & Lunn Capital Markets Inc., the manager of the fund, has approved a proposal that would result in the merger of GFO and Australia Banc Income Fund ("AUI") (the "Merger Proposal"). AUI will be the continuing fund and, as a result, holders of Class A Units and Class F Units of GFO would become holders of Class A Units and Class F Units of AUI. The objectives of the Merger Proposal are to provide GFO unitholders with the opportunity to continue their investment in foreign financial services equities in a single fund that will have a larger market capitalization, increased liquidity for the units and a lower management expense ratio including lower management fees for GFO unitholders. The investment objectives of AUI, as the continuing fund, are to (i) provide holders of AUI units with quarterly distributions; (ii) provide the opportunity for capital appreciation; and (iii) lower overall volatility of portfolio returns than would be experienced by owning common shares of the Australian banks directly. The investment strategy of AUI is to obtain exposure, on an approximately equally weighted basis, to the common shares of the five largest Australian banks, which the Manager believes are attractive long-term investments with attractive dividend yields. The Manager may also sell call options on approximately, and not more than, 25% of the common shares of each bank held in the portfolio. In order for the Merger Proposal to become effective, it must be approved by a two-thirds majority of the unitholders of GFO present in person or represented by proxy at the Meeting. The Merger Proposal is also subject to the receipt of all necessary regulatory and stock exchange approvals. If approved, the extraordinary resolution is expected to be implemented on or about June 11, 2013 (the "Effective Date"). If the Merger Proposal is approved and implemented, unitholders of GFO will have the opportunity to redeem their GFO units for a redemption price equal to net asset value per unit if they choose not to participate going forward by tendering their units no later than May 31, 2013 for redemption on June 7, 2013. Payment of the redemption price will be made no later than 10 days following the Effective Date. A special meeting of GFO unitholders will be held at 8:30 a.m. ( Toronto time) on May 16, 2013 at 1 First Canadian Place, Suite 6600, 100 King Street West, Toronto, Ontario. Details of the Merger Proposal will be outlined in an information circular (the "Circular") to be sent to unitholders in connection with the special meeting. Class A Units of Connor, Clark & Lunn Financial Opportunities Fund are listed on the Toronto Stock Exchange ("TSX") under the symbol GFO.UN and Class A Units of Australian Banc Income Fund are listed on the TSX under the symbol AUI.UN.