Brookfield needs holders of bonds, preferreds to approve combination

By Angela McDaniels

Tacoma, Wash., Sept. 13 - Brookfield Asset Management Inc. wants to combine one of its subsidiaries with the assets of another and needs bondholder and preferred stockholder approval to do so, according to a company news release.

Brookfield Renewable Power Fund will be combined with the power generating assets owned by Brookfield Renewable Power Inc. to create Brookfield Renewable Energy Partners LP, a publicly traded partnership focused on renewable power generation.

Among other things, the closing of the transaction is subject to the approval of two-thirds of the holders of C$250 million of preferred stock and the holders of Brookfield Renewable Power Inc.'s C$1.1 billion of unsecured public corporate bonds.

Subject to security holder approvals, subsidiaries of the new partnership will be responsible for all obligations related to the bonds and preferreds, and the new partnership will guarantee the bonds and preferreds.

The company expects that Standard & Poor's and DBRS will reaffirm the current investment-grade ratings of the issuers of the bonds and preferreds following the combination and that Brookfield Renewable Energy Partners will receive ratings equivalent to the fund's current ratings.

There are no material changes to the terms of the bonds or the preferreds.

Brookfield Asset Management is an alternative asset manager. Brookfield Renewable Power Inc. owns, develops and operates hydroelectric power facilities. Both are based in Toronto.

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