Brookfield Property Partners, which spun off from Brookfield Asset Management earlier this year, has offered to buy the remaining shares of Brookfield Office Properties it does not already own in a transaction valued by the company at $5 billion.
In the planned tender offer, BPO shareholders would receive $19.34 per share–a 15 percent premium on the stock’s price at Friday’s market close and a 17 percent premium to the 30-day volume-weighted average price. Shares in BPO traded up over 16 percent to $19.54 in early morning trading on the New York Stock Exchange.
“The offer provides an attractive opportunity for BPO shareholders to exchange their common shares for an interest in our flagship global property company and cash,” said Ric Clark, chief executive officer of Brookfield Property Group, in a prepared statement. “The combination of these leading commercial real estate platforms will create a diversified portfolio of best-in-class real estate for investors seeking attractive risk-adjusted returns, through income and capital appreciation.”
In April, Brookfield Property Partners completed its spinoff from Toronto-based Brookfield Asset Management. The new company owns substantially all of Brookfield’s commercial real estate assets across the company’s global portfolio.
Should Brookfield Property Partners increase its 51 percent ownership stake in BPO to 100 percent, it will be one of the world’s largest commercial real estate companies with $45 billion in assets, including Brookfield Place in Downtown Manhattan, previously known as the World Financial Center.