By James Langton

(January 29 – 11:40 ET) – Assuming that the Power Financial Corp. bid for Mackenzie Financial Corp. goes ahead as planned, the deal could see Investors Group Inc. subsidiary MAXXUM Fund Management Inc. integrated into Mackenzie at some point.

In a analysts conference call this morning, it was revealed that the proposed deal will become accretive to IG’s cash earnings in the second year. Part and parcel of this will be $75 million in cost cutting synergies the firms hope to achieve. Much of the cuts are expected to come out the elimination of duplication in regulatory expenses and back office synergies.

Mackenzie is expected to operate on a stand alone basis from Toronto, while IG continues operations in Winnipeg. It’s conceivable that that MAXXUM could become part of Mackenzie in some form. Although management says there have been no hard and fast decisions made on this yet, they concede it wouldn’t make sense to maintain both firms separate from one another.

IG advisors can also expect to see Mackenzie products introduced into their product shelf as soon as possible. IG CEO Sandy Riley says that the firms will be sitting down to decide what they can do, what they should do and how quickly can they do it. “Obviously we’d like to have a fund managed by Jerry Javasky,” he told analysts this morning, suggesting that there will be a short and long-term approach to introducing Mackenzie products.

Also under discussion is the possibility of extending IG’s deal with CIBC to distribute banking services through its advisor network into some sort of Mackenzie product for the independent channel.

The proposed deal won’t close until April, thanks to regulatory requirements mandating 60 days notice to unitholders.