BPO seeks to exchange its preferreds for those issued by Brookfield

By Susanna Moon

Chicago, March 22 - BPO Properties Ltd. said it is proposing to exchange its preferred shares for new class AAA preference shares of Brookfield Office Properties Inc.

In the exchange offer, holders will receive one class AAA preference share of Brookfield Office Properties for each preferred share of BPO Properties.

The Brookfield preference shares will have substantially the same terms and conditions as the preferreds of BPO Properties that are exchanged, including the dividend rates, according to a company press release.

Currently, the series G, J and M preferred shares of BPO Properties are listed on the TSX Venture Exchange. The new class AAA preference shares of Brookfield Office Properties replacing the series G, J and M preferred shares will begin trading on the exchange after the proposed transaction closes, if approved by the exchange, and the series G, J and M preferred shares of BPO Properties will be delisted from the exchange.

Brookfield Office Properties acquired 100% of the outstanding common shares of BPO Properties in 2010 in connection with the formation of Brookfield Canada Office Properties, a limited-purpose unincorporated closed-ended real estate investment trust, the release said.

Since that time, BPO Properties has continued to be a reporting issuer with publicly traded preferred shares. The proposed exchange would reduce administrative costs and simplify operations, the release noted.

The company said its board of directors, on the unanimous recommendation of the independent committee, has decided that the exchange would be in the best interests of BPO Properties and is unanimously recommending that preferred shareholders vote in favor of it at the upcoming meeting of preferred shareholders on April 26.

The proposed transaction requires the approval of at least two-thirds of the votes cast at a meeting by all preferred shareholders of BPO Properties as well as by the Ontario Superior Court of Justice.

Brookfield Asset Management Inc. and the affiliates of Brookfield Office Properties currently hold, directly and indirectly, preferred shares of BPO Properties, which carry about 69.2% of the votes attaching to all preferred shares.

Brookfield Office Properties owns, develops and manages office properties and is based in Toronto.

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