Brookfield Asset Management (BAM) is relocating its head office from Toronto to New York, in a strategic move aimed at increasing visibility in US stock indexes and attracting a wider pool of institutional and active public investors, according to a report by Bloomberg.
The relocation is aimed at aligning the Canadian alternative investment giant more closely with US-focused indices, which could broaden its investor base and strengthen its presence in the largest market for its operations.
In a statement released on Thursday, Chief Financial Officer Hadley Peer Marshall explained to investors that this shift reflects the substantial portion of Brookfield’s workforce and revenue originating in the US, although BAM will continue to be incorporated in Canada. According to BAM’s announcement, the relocation will not impact its operational strategy, dividend tax treatment, or overall business plans.
As part of this restructuring, Brookfield Corp, BAM’s parent company, will exchange its unlisted 73% stake in BAM for publicly traded Class A shares in a one-for-one transaction. This exchange is expected to streamline Brookfield’s corporate structure, ensuring that BAM’s publicly traded shares reflect its full market value, which stands at approximately $85bn based on current prices, compared to the current $23bn valuation.
Brookfield Asset Management shareholders are set to vote on the share swap at a meeting on 20 December. If approved, this restructuring will not alter Brookfield Corp’s economic stake in BAM, but it would simplify BAM’s market presence and potentially attract more capital.
Brookfield Corp spun out 25% of its asset management business into the publicly traded BAM nearly two years ago. The asset management unit, which oversees fee-generating assets worth around $1tn, has seen its stock rise by approximately 32% since the beginning of the year, despite a recent dip of 1.4% to $53.04 in New York trading.
