says it will move ahead with a plan to spin off a new asset-management business to shareholders by year’s end, creating what it hopes to be a roughly US$80-billion entity that will pay most of the dividends Brookfield shareholders now receive.
“The bottom line is that today’s Brookfield consists of two businesses that are very different in nature but work together very well,” CEO Bruce Flatt said in announcing the move in his quarterly letter to shareholders, released Thursday morning. “Looking forward, we believe that each of these businesses has incredible potential to expand further.
Mr. Flatt said the current Brookfield’s “appetite for investment capital” means that it will cut its annual dividend, with an eye toward the two dividends being around the same as Brookfield’s payout today. The asset manager will list on the New York and Toronto stock exchanges. Brookfield expects the spinoff to be tax-free to shareholders. It also said it will ensure that holders of Brookfield Reinsurance shares -- exchangeable for Class A shares of Brookfield -- will be treated equally from an economic perspective.