BAM.PR.P, the Brookfield Asset Management FixedReset 7.00%+445 announced on May 27, has commenced trading.
The issue traded 947,772 shares in a range of 25.05-30 before closing at 25.25-28, 9×19.
Vital statistics are:
Maturity Type : Limit Maturity
Maturity Date : 2039-06-04
Maturity Price : 25.20
Evaluated at bid price : 25.25
Bid-YTW : 6.78 %
BAM.PR.P has been added to the HIMIPref™ FixedReset subindex.
It is of interest that Brookfield issued CAD 500-million in five-year notes almost simultaneously with this issue. The debentures carry a coupon of 8.95%, with the following highlighted in the prospectus:
We may redeem some or all of the notes at any time at 100% of the principal amount plus a make-whole premium. We will be required to make an offer to purchase the notes at a price equal to 101% of their principal amount, plus accrued and unpaid interest to the date of repurchase upon the occurrence of a Change of Control Triggering Event (as defined herein).
The “make-whole” provision is simply a Canada call at +162bp. The Change of Control Triggering Event means not just a change in control, but also a downgrade of the debs to below investment grade by three out of the four main rating agencies.