Guardian Capital Group is calling a special meeting of shareholders to garner approval for its proposed sale of the Guardian mutual funds to Bank of Montreal. The meeting is slated for June 25.

Before the meeting even starts, 66% of the common shares are pledged in favour of the deal. A recently filed proxy circular also reveals that Joseph Rotman, who beneficially owns 14.6% of Guardian through an RRSP, will not vote on the proposal as he is also a director of BMO.

The circular states that, “The sale of GGOF to BMO was based on growth and synergies. The rate of growth that GGOF can attain with BMO because of its substantial resources is anticipated to be substantially higher than if GGOF had remained a subsidiary of the corporation.”

The circular argues that the deal will benefit Guardian fund unitholders because “the resources of BMO are anticipated to be applied to product development and client and dealer services”. It says the deal is beneficial to GGOF employees because “it is based on growth and is anticipated to provide employees with more and broader opportunities in the future”.

Berkshire Capital Corporation, a New York based independent investment banking firm specializing in the investment management industry, evaluated the deal for Guardian, but did not offer a formal fairness opinion. It recommends the deal.

The proxy also reveals that Guardian has also agreed to certain non-competition, non-solicitation and confidentiality provisions for five years. It has agreed that it will maintain any investments it or any of its affiliates have made in any GGOF mutual fund as seed capital, subject to a specified period of time following the closing of the transaction.