Brookfield Residential To Be Taken Private By Brookfield Asset Management

(RTTNews) - Canadian property owner Brookfield Asset Management Inc. (BAM, BAM_A.TO) has agreed to take Brookfield Residential Properties Inc. (BRP, BRP.TO) private in a deal valued at about $871 million, the two companies said Monday.

Toronto, Ontario-based Brookfield Asset Management is a publicly-owned alternative asset manager focused on property, renewable power and infrastructure assets. The company has about $200 billion in assets under management.

Brookfield Residential Properties operates as a land developer and home builder in North America.

Under the terms of the deal, Brookfield Asset Management will acquire the 30.6 percent stake, or about 35.9 million shares, in Brookfield Residential Properties that it does not already own, by way of a court-approved plan of arrangement.

Shareholders of Brookfield Residential will receive $24.25 in cash per common share, which is 5.4 percent more than Brookfield Asset Management's initial proposal on October 23 to privatize Brookfield Residential for $23.00 per share. It also represents a premium of about 28 percent to Brookfield Residential's closing stock price of $19.01 on October 23.

The transaction will provide total consideration to minority shareholders of Brookfield Residential of about $871 million.

Brookfield Residential's board of directors approved the deal following a favorable recommendation of its special committee of independent directors formed to review and consider the arrangement. The board plans to unanimously recommend that shareholders of Brookfield Residential approve the arrangement at their special meeting scheduled for March 10, 2015.

The implementation of the arrangement is subject to the approval of at least two-thirds of the votes cast at the meeting by Brookfield Residential shareholders present in person or by proxy, and by a majority of the votes cast by Brookfield Residential shareholders other than Brookfield Asset Management and its affiliates.

Completion of the deal is subject to certain customary conditions, including the approval of the Ontario Superior Court of Justice.

Cyrus Madon, Senior Managing Partner of Brookfield Asset Management said, "After an extensive process, we are pleased to have come to terms on a transaction that has the full support of the Brookfield Residential Board. We believe that the transaction offers strong value for Brookfield Residential shareholders, and we look forward to working towards its successful completion in early 2015."

BAM closed Tuesday's trading on the NYSE at $49.63, up $0.33 or 0.67 percent on a volume of 381,764 shares. In after-hours, the stock declined $0.03 or 0.05 percent to $49.60.

BRP closed Tuesday's trading at $22.86, down $0.14 or 0.61 percent on a volume of 206,704 shares.