CI Fund Management Inc. is once again proposing to convert into an income trust. In a news release today CI says that it’s pursuing the conversion of CI Financial to an income trust and will seek an advance income tax ruling from the Canada Revenue Agency relating to the conversion. CI expects to submit the tax ruling request later this week.

The firm notes that the conversion is expected to be considered by CI’s board of directors in early October, and, if approved by the board, would be submitted to CI’s shareholders for their approval at the annual meeting of shareholders to be held not later than Nov. 30.

A conversion by CI Financial to an income trust would likely be effected by way of a statutory plan of arrangement and would be subject to, among other things, regulatory and court approvals.

“Tax rulings are generally not required for transactions of this nature, but we feel it is prudent given the size of CI – even though the structure we are contemplating is similar to existing income trust structures,” said Bill Holland, CI’s chief executive officer.

“Since we last examined the merits of conversion to an income trust in 2003, we have seen many favourable changes to the long-term environment for income trusts,” said Holland. “These include the withdrawal of restrictions on the ownership of trusts by pension funds, the addition of trusts to the S&P/TSX Composite Index, the elimination of limited liability concerns, and the development of an asset class close to $200-billion and growing.”

Earlier today, the Department of Finance launched a consultation on the impact of the income trust phenomenon, on both tax revenues and economic efficiency.

Also, income trust conversions appear to be gaining momentum. GMP Capital Corp. is leading the way among financial firms. And, large mainstream firms such as Precision Drilling Corp. and CanWest Global Communications Corp. are also planning income trusts for some of their assets.