Brookfield Corporation has announced:
that it has determined the fixed dividend rate on its Cumulative Class A Preference Shares, Series 38 (the “Series 38 Shares”) (TSX: BN.PF.E) for the five years commencing April 1, 2025 and ending March 31, 2030.
If declared, the fixed quarterly dividends on the Series 38 Shares during the five years commencing April 1, 2025 will be paid at an annual rate of 5.185% ($0.3240625 per share per quarter).
Holders of Series 38 Shares have the right, at their option, exercisable not later than 5:00 p.m. (Toronto time) on March 17, 2025, to convert all or part of their Series 38 Shares, on a one-for-one basis, into Cumulative Class A Preference Shares, Series 39 (the “Series 39 Shares”), effective March 31, 2025. The quarterly floating rate dividends on the Series 39 Shares will be paid at an annual rate, calculated for each quarter, of 2.55% over the annual yield on three-month Government of Canada treasury bills. The actual quarterly dividend rate in respect of the April 1, 2025 to June 30, 2025 dividend period for the Series 39 Shares will be 1.34331% (5.388% on an annualized basis) and the dividend, if declared, for such dividend period will be $0.3358275 per share, payable on June 30, 2025.
Holders of Series 38 Shares are not required to elect to convert all or any part of their Series 38 Shares into Series 39 Shares.
As provided in the share conditions of the Series 38 Shares, (i) if Brookfield determines that there would be fewer than 1,000,000 Series 38 Shares outstanding after March 31, 2025, all remaining Series 38 Shares will be automatically converted into Series 39 Shares on a one-for-one basis effective March 31, 2025; and (ii) if Brookfield determines that there would be fewer than 1,000,000 Series 39 Shares outstanding after March 31, 2025, no Series 38 Shares will be permitted to be converted into Series 39 Shares. There are currently 7,906,132 Series 38 Shares outstanding.
The Toronto Stock Exchange (“TSX”) has conditionally approved the listing of the Series 39 Shares effective upon conversion. Listing of the Series 39 Shares is subject to Brookfield fulfilling all the listing requirements of the TSX.
They later announced:
that after having taken into account all election notices received by the deadline for the conversion of its Cumulative Class A Preference Shares, Series 38 (the “Series 38 Shares”) (TSX: BN.PF.E) into Cumulative Class A Preference Shares, Series 39 (the “Series 39 Shares”), there were 42,035 Series 38 Shares tendered for conversion, which is less than the one million shares required to give effect to conversion into Series 39 Shares. Accordingly, there will be no conversion of Series 38 Shares into Series 39 Shares and holders of Series 38 Shares will retain their Series 38 Shares.
BN.PF.E was issued as BAM.PF.E, a FixedReset, 4.40%+255, that commenced trading 2014-3-13 after being announced 2014-3-6. It reset to 3.568% effective 2020-4-1. I made a preliminatry recommendation not to convert and there was no conversion. The ticker changed to BN.PF.E in late 2022. The issue is tracked by HIMIPref™ and is assigned to the FixedReset (Discount) subindex.