Perhaps intruiged by recent queries about USD Prefs with eligible dividends and distraught at the idea that there is a fragment of the capital markets left untapped, Brookfield Asset Management has issued a Preliminary Short Form Base Shelf Prospectus for USD 1-billion in debt securities and Class A Preference Shares.
Sorry I can’t link to it, but that would constitute dissemination of public information to the public, which the regulators have sworn to stamp out. Can’t have just anybody linking to a prospectus, eh? It’s on SEDAR, dated December 30.
There is no indication as to whether the dividends will be eligible for the full dividend tax credit – that will have to wait for the supplementary prospectus for a specific issue.
To my disappointment, the specific terms of the Australian refinancing have still not been disclosed. All it says is:
Also in November 2008, the Company announced that it had finalized an agreement to extend the final maturity of a debt financing of its Australian operations by one year. Under the terms of the agreement, the loan will be US$800 million of which US$140 million will be repaid in April 2009 and the balance in April 2010. The Company also announced its intention to combine all of its European operations into a single operating platform and to refinance it on a longer-term basis in the European markets.
Many thanks to Assiduous Reader MP – who, I suspect, is angling for a job as PrefBlog’s Regulatory Filings Editor – for bringing this to my attention.
I fear this might adverserly affect their credit ratings if they are in fact to proceed with those issuances for general corporate purposes as per the prospectus (I would not be as much concerned if this was for an acquisition). The least I can say is that BAM is difficult to read in. Last December 15th they were still buying back for cancellation some of their ordinary stock (a “luxury” that no other financial institution can afford these days except for Faifax IIRC).
To the end of 3Q08, share purchases roughly balanced issuance due to dividend reinvestment plans and option exercise, according to their 3Q08 Supplementary Report; the amounts were well covered by cash flow & profit.
Overleverage is always a concern with any company, but the maintenance of access to cheap capital is so important to BAM that I can’t see them doing it lightly.
My guess is that they’re getting their ducks in a row for a few distressed real-estate deals in the States … but what do I know?