{"id":9959,"date":"2010-03-02T15:55:33","date_gmt":"2010-03-02T19:55:33","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=9959"},"modified":"2010-03-02T15:55:33","modified_gmt":"2010-03-02T19:55:33","slug":"bam-issues-7-year-notes-at-52","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=9959","title":{"rendered":"BAM Issues 7-Year Notes at 5.2%"},"content":{"rendered":"

Brookfield Asset Management has announced<\/a>:<\/p>\n

an offering of C$300 million of medium term notes (unsecured) (\u201cnotes\u201d) with a September 2016 maturity and a yield of 5.2%.<\/p>\n

The notes have been assigned a credit rating of Baa2 (stable outlook) by Moody\u2019s; A- (negative outlook) by Standard & Poor\u2019s; BBB (stable outlook) by Fitch; and A low (stable outlook) by DBRS.<\/p>\n

The notes are being offered through a syndicate of agents led by CIBC World Markets Inc. and RBC Capital Markets.<\/p>\n

The net proceeds of the issue will be used to refinance US$200 million of notes that matured March 1, 2010 and for general corporate purposes.<\/p><\/blockquote>\n

This is useful data to have when evaluating BAM.PR.J, which is retractible on 2018-3-31 (presumed to trigger a call at $25 immediatly prior to exercise) which closed last night at 26.03-05 to yield 4.94-3%, equivalent to 6.90-1% interest at the standard equivalency factor of 1.4x. The interest-equivalent spread of about 170bp will be thought by many to more than adequately compensate for the seniority risk and slightly longer term. Note, however, that I have not yet reviewed the prospectus for the new bond issue – there may be terms and conditions peculiar to these notes which affect valuation.<\/p>\n

Update<\/b>: The Globe and Mail<\/i> reports there is a credit-rating-linked put<\/a>:<\/p>\n

To give investors comfort, single-A-rated Brookfield agreed to buy back this paper at 101 cents on the dollar if its credit rating drops below investment grade, or if there is a change in control at the conglomerate.<\/p><\/blockquote>\n

That’s valuable – but in aggregate, that type of clause can leave credit quality on a knife-edge … as AIG found out.<\/p>\n","protected":false},"excerpt":{"rendered":"

Brookfield Asset Management has announced: an offering of C$300 million of medium term notes (unsecured) (\u201cnotes\u201d) with a September 2016 maturity and a yield of 5.2%. The notes have been assigned a credit rating of …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-9959","post","type-post","status-publish","format-standard","hentry","category-issue-comments"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/9959","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=9959"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/9959\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=9959"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=9959"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=9959"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}