Q: I am considering taking a position in BPO.PR.C
Attractive yield, 6% min as well 5.18 above 5yr when resets.
The question is would BPO ever default?
Are they allowed to buy these back on the open market?
Your opinion please,,
Attractive yield, 6% min as well 5.18 above 5yr when resets.
The question is would BPO ever default?
Are they allowed to buy these back on the open market?
Your opinion please,,
5i Research Answer:
Brookfield could apply to do a buyback, and get TSX approval of such. The default question is trickier. As a subsidiary of BN, it is unlikely, but BPO is a separate legal entity, and BN is not legally obligated to support it. In a doomsday type of scenario, we would expect BN to walk away from it. This would of course be devastating to the repuation of the Brookfield group, but in a worst-case scenario we would expect BN to save itself first. We would give odds of such an event at close to zero, but just not 0.00%.