Press Release 2004
BNN Split Corp. Announces Class AA, Series 1 Preferred Share Offering
Toronto, March 9, 2004 - BNN Split Corp. (BNA.PR.A: TSX) today announced that it has agreed to issue $80,000,000 of fixed cumulative redeemable Class AA Series 1 preferred shares with a dividend rate of 4.95% to a syndicate of underwriters led by Scotia Capital Inc. The Class AA Series 1 preferred shares have received a provisional rating of Pfd-2 by Dominion Bond Rating Services (“DBRS”). Closing is expected to take place on or about March 25, 2004.
Part of the net proceeds of the issue of the Class AA Series 1 preferred shares will be used to acquire additional Brascan Corporation Class A Limited Voting Shares (“Brascan Shares”) from BNN Investments Ltd. for cash. BNN Investments Ltd. owns all of the Company's Class A voting shares and all of the capital shares of the Company. Part of the net proceeds of the issue, along with an issuance of Class AA Series 2 preferred shares, will be used to finance the purchase of Brascan Shares from EdperPartners Limited. EdperPartners Limited and its shareholders collectively own, directly or indirectly, approximately 30 million Brascan Shares, representing approximately 16% of the outstanding Brascan Shares and 100% of the Class B Limited Voting Shares of Brascan. The remaining net proceeds of the issue will be used to purchase Brascan Shares at such times following closing as the board of directors of the Company may determine.
Concurrently with closing of the offering of the Class AA Series 1 preferred shares, the Company will split the existing capital shares held by BNN Investments Ltd. so that an equal number of preferred shares (of all classes and series) and capital shares will be outstanding.
BNN Split currently owns a portfolio consisting of 9,612,000 Brascan Shares in order to generate fixed cumulative preferential dividends for the holders of its preferred shares and to enable the holders of its capital shares to participate in any capital appreciation of Brascan Shares. Brascan Corporation is an asset management company. With a focus on real estate and power generation, Brascan Corporation has direct investments of US$16 billion and a further US$5 billion of assets under management. This includes 55 premier office properties and 45 power generating plants.
Bruce K. Robertson, President and Chief Executive Officer, will be available at 416-363-0061 to answer any questions on the company's financial results.
This news release contains forward-looking statements concerning the company's business and operations. The company cautions that, by their nature, forward-looking statements involve risk and uncertainty and the company's actual results could differ materially from those expressed or implied in such statements. Reference should be made to the most recent Annual Information Form for a description of the major risk factors.