The Ontario Securities Commission granted Brookfield Corporation an exemption from the formal issuer bid requirements outlined in Part 2 of National Instrument 62-104 Take-Over Bids and Issuer Bids (NI 62-104). This decision was made in connection with Brookfield’s proposed repurchase of 2,000,000 Class A Preference Shares, Series 15 from a single shareholder who is a sophisticated investor and qualifies as an accredited investor under National Instrument 45-106 Prospectus Exemptions (NI 45-106).
The key reasons for the exemption include:
1. The shares in question are held entirely by one shareholder, who is at arm’s length from Brookfield and is not an insider or affiliate.
2. The shareholder is an accredited investor, suggesting they possess the necessary financial acumen and do not require the same level of protection as retail investors.
3. The repurchase will be conducted through a private contract at a negotiated price, and the transaction does not require approval from other shareholders or affect the control of the company.
4. There is no material change or fact about Brookfield that has not been disclosed to the public that would influence the transaction.
The exemption is conditional upon:
a. No other person or company holding the subject shares at the time of purchase, other than the selling shareholder.
b. Both parties not being aware of any undisclosed material changes or facts about Brookfield at the time of the agreement and purchase.
c. The agreement including an acknowledgment from the selling shareholder regarding the exemption and their status as an accredited investor, and that they will not receive an issuer bid circular or other formal issuer bid protections.
This decision is based on the provisions of section 6.1 of NI 62-104 and is aimed at facilitating the transaction without undermining the public interest. The order was issued on February 28, 2023.