Brookfield Office Properties Inc., a subsidiary of Brookfield Property Partners, has announced:
that it has determined the fixed dividend rate on its Class AAA Preference Shares, Series N (“Series N Shares”) (TSX: BPO.PR.N) for the five years commencing July 1, 2016 and ending June 30, 2021. If declared, the fixed quarterly dividends on the Series N Shares during that period will be paid at an annual rate of 3.782% ($0.236375 per share per quarter).
Holders of Series N Shares have the right, at their option, exercisable not later than 5:00 p.m. (Toronto time) on June 15, 2016, to convert all or part of their Series N Shares, on a one-for-one basis, into Class AAA Preference Shares, Series O (the “Series O Shares”), effective June 30, 2016.
The quarterly floating rate dividends on the Series O Shares have an annual rate, calculated for each quarter, of 3.07% over the annual yield on three-month Government of Canada treasury bills. The actual quarterly dividend rate in respect of the July 1, 2016 to September 30, 2016 dividend period for the Series O Shares will be 0.91244% (3.62% on an annualized basis) and the dividend, if declared, for such dividend period will be $0.22811 per share, payable on September 30, 2016.
Holders of Series N Shares are not required to elect to convert all or any part of their Series N Shares into Series O Shares.
As provided in the share conditions of the Series N Shares, (i) if Brookfield determines that there would be fewer than 1,000,000 Series N Shares outstanding after June 30, 2016, all remaining Series N Shares will be automatically converted into Series O Shares on a one-for-one basis effective June 30, 2016; and (ii) if Brookfield determines that there would be fewer than 1,000,000 Series O Shares outstanding after June 30, 2016, no Series N Shares will be permitted to be converted into Series O Shares. There are currently 11,000,000 Series N Shares outstanding.
The Toronto Stock Exchange (“TSX”) has conditionally approved the listing of the Series O Shares effective upon conversion. Listing of the Series O Shares is subject to Brookfield fulfilling all the listing requirements of the TSX and, upon approval, the Series O Shares will be listed on the TSX under the trading symbol “BPO.PR.O”.
BPO.PR.N is a FixedReset 6.15%+307, that commenced trading 2010-1-20 after being announced 2010-1-11. The issue attracted some unfavourable comment on issue due to the relatively long call lock-out period – which shows complete misunderstanding of the investment impact of an issuer call option, but we’ll ignore that.
The new rate therefore represents a 39% cut in dividends.
As noted, the deadline to notify the company is 5 p.m. (Toronto time) on June 15, 2016.; brokers will have internal deadlines a day or two in advance.
I will post a recommendation regarding whether or not to convert closer to the deadline.
This entry was posted on Saturday, June 4th, 2016 at 12:51 am and is filed under Issue Comments. You can follow any responses to this entry through the RSS 2.0 feed.
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BPO.PR.N To Reset To 3.782%
Brookfield Office Properties Inc., a subsidiary of Brookfield Property Partners, has announced:
BPO.PR.N is a FixedReset 6.15%+307, that commenced trading 2010-1-20 after being announced 2010-1-11. The issue attracted some unfavourable comment on issue due to the relatively long call lock-out period – which shows complete misunderstanding of the investment impact of an issuer call option, but we’ll ignore that.
The new rate therefore represents a 39% cut in dividends.
As noted, the deadline to notify the company is 5 p.m. (Toronto time) on June 15, 2016.; brokers will have internal deadlines a day or two in advance.
I will post a recommendation regarding whether or not to convert closer to the deadline.
This entry was posted on Saturday, June 4th, 2016 at 12:51 am and is filed under Issue Comments. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.