Brookfield Planning $500 Million Private-Equity Spinoff

Updated on

Brookfield Asset Management Inc., Canada’s largest alternative asset manager, will create a new publicly traded subsidiary by spinning off a portion of its private-equity arm through a special $500 million dividend.

Brookfield Business Partners will be the fourth public company under the Brookfield umbrella, and is valued at roughly $2 billion, the company said Wednesday in a statement.

The payment is worth about 50 cents a share, or about $500 million, Toronto-based Brookfield said. The new subsidiary will own and operate almost all of the business services and industrial operations previously held by Brookfield Asset Management’s private-equity portfolio.

“It is the right time for us to create BBP and give our shareholders an opportunity to participate directly in its operations and growth,” Brookfield Chief Executive Officer Bruce Flatt said in the statement. “We have seen substantial growth in our private-equity platform over the last five years and continue to see significant opportunities globally for this business.”

Brookfield Business Partners, a Bermuda-based limited partnership, will operate in a similar manner to the company’s other publicly traded subsidiaries, Brookfield Property Partners, Brookfield Infrastructure Partners, and Brookfield Renewable Energy Partners.

Fundraising Target

Brookfield Asset Management said in August it was increasing its fundraising target for the year by as much as 20 percent to $25 billion as it scours volatile global markets for purchases. The company’s assets under management reached $218 billion at the end of the second quarter.

In August, Brookfield Infrastructure agreed to buy Australian rail and port operator Asciano Ltd. for roughly $6.55 billion.

The BBP unit is expected to be listed on stock exchanges in the U.S. and Canada in the first quarter of 2016 subject to approvals, the company said.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE