U.S. Markets open in 6 hrs 36 mins

Brookfield Redeeming Notes

Zacks Equity Research

Brookfield Asset Management Inc. (BAM) has announced the redemption price of 8.95% Notes worth the principal amount of C$150 million. These notes will be redeemed on Mar 6, 2013.

These notes, with redemption price of C$1077.62, were scheduled to mature on Jun 2, 2014. The notes are originally priced at C$1,000. Therefore, an earlier redemption would give investors an additional 8% benefit. The total redemption amount will also include accrued and unpaid interest of C$23.37, thereby bringing the total redemption price up to C$1100.99.

Over the past six months, Brookfield has been on a balance sheet restructuring spree. In Jan, the company announced the issuance of medium-term notes worth C$350 million, including C$175 million of a re-opening of notes with a Mar 2023 maturity and C$175 million principal amount of a re-opening of notes maturing in Apr 2019.

Further, in Nov 2012, the company concluded the issuance of 4.85% perpetual Class A Preference Shares, Series 36 worth C$200 million. In Oct 2012, the company announced redemption price of C$350 million worth of 8.95% Notes.

Redemption of notes is a positive step for banks since it helps bring down interest expenses. Further, a reduction in long-term debt will go a long way in improving the overall financials of Brookfield.  For the fourth quarter of 2012, interest expenses were $637 million, up 2.7% year over year.

Currently, Brookfield retains Zacks Rank #3 (Hold). Other asset managers that are performing better than Brookfield include AllianceBernstein Holding L.P. (AB), Cohen & Steers Inc. (CNS) and Lazard Ltd. (LAZ). All these carry the Zacks Rank #1 (Strong Buy) status.

Read the Full Research Report on BAM

Read the Full Research Report on LAZ

Read the Full Research Report on AB

Read the Full Research Report on CNS

Zacks Investment Research

More From Zacks.com