Brookfield offers to take property for $ 5.9 billion


People pass through the Brookfield Place Pavilion at the World Trade Center West Concourse pedestrian transit connection in New York City.

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Brookfield Asset Management said on Monday it offered to take its commercial real estate arm Brookfield Property Partners into a private $ 5.9 billion deal.

The Canadian asset-management firm is offering $ 16.50 for every Brookfield property share it does not already own.

“Personalization will allow us to operate the portfolio and realize the intrinsic value of BPY’s high quality assets,” Brookfield Asset Management CFO Nick Goodman said in a statement.

Brookfield Property has approximately $ 88 billion in assets, including office buildings, malls, self-storage facilities, and logistic hubs. Due to the effects of the Kovid epidemic, the value of many of its properties has fallen. Retail and office locations are seen as particularly risky bets, as vacancies increase and more people adjust to shopping and working from home.

On the Nasdaq, Brookfield property shares are down nearly 20% from a year ago. The stock rose more than 15% in prepaid trading on Monday, while Brookfield Asset Management shares remained unchanged.

In a separate press release, Brookfield Property stated that its board has established an independent committee to review the proposal.

The $ 16.50 per unit price represents a premium of 14.9% and 14.0% respectively, the closing price of Brookfield Property shares on the Toronto Stock Exchange and the Nasdaq from December 31. Shareholders will be able to elect to receive $ 16.50 in cash for each. Brookfield Asset Management stated that Brookfield Property Unit, 0.40 Brookfield Class A Shares, or Brookfield Property prefers 0.66 with a liquidation preference of $ 25 per unit.

Brookfield Asset Management, which has approximately $ 575 billion in assets under management, said it did not propose to acquire other securities of Brookfield Property and its subsidiaries. They are expected to remain outstanding.

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