Brookfield Soars in Brazil on Plan to Take Builder Private

Brookfield Incorporacoes SA, Brazil’s worst-performing homebuilder in the past year, surged to the highest since October as its biggest shareholder offered to buy the stock it doesn’t own and delist the company.

BRB Participacoes, a unit of Toronto-based Brookfield Asset Management Inc. that owns 39 percent of the Brazilian builder, will offer as much as 1.60 reais each for all outstanding voting shares, according to a regulatory filing after the close of the market on Feb. 14.

Brookfield jumped 19 percent to 1.47 reais at the close of trading in Sao Paulo, paring the loss over the past 12 months to 57 percent. It was the best performer on the benchmark Ibovespa gauge today, which dropped 1.3 percent.

“The trend is for the stock to converge to that offer price,” Joao Pedro Brugger, who helps oversee 400 million reais at Leme Investimentos Ltda., said in a phone interview from Florianopolis, Brazil. “But it should trade at a slight discount until the minority shareholders accept the offer.”

The controlling holder asked for a vote by investors on the tender offer at an extraordinary meeting, according to the filing. It said on Jan. 27 that it was “analyzing strategic alternatives” for Brookfield including a delisting.

Brookfield did its initial public offering in October 2006, selling shares for 16 reais each.

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