BCE Transfers Real Estate Interests to Carena Developments

Strategic Insights -

Carena Developments Ltd. has gained full ownership of Brookfield Development Corp., a subsidiary of BF Realty Holdings Ltd., after acquiring BCE Inc.'s stake in the company. The transfer, valued at around $200 million, includes $175 million for BCE's equity in the landmark office tower and $25 million in BF Realty debentures. This move has given Carena 100% control over Brookfield, but officials have stated they have no immediate plans to convert the loans to common equity.

Key Takeaways:

  • Carena Developments Ltd. has acquired BCE Inc.'s interests in Brookfield Development Corp. for approximately $200 million.
  • The transfer includes $175 million for BCE's equity in the landmark office tower and $25 million in BF Realty debentures.
  • Carena now has 100% control over Brookfield, but officials have stated they have no immediate plans to convert the loans to common equity.
  • BCE and Carena initially invested $700 million in new loans into Brookfield in 1989, and Carena subsequently invested an additional $100 million.
  • Carena began consolidating Brookfield's financial results with its own in 1993, retroactive to October 31 of that year.
  • Carena officials plan to approach the BF Realty board of directors to determine whether BF Realty has enough value to cover any partial payment to its preferred shareholders and debenture holders.
  • Preferred shareholders and debenture holders have mounted legal and other challenges to Carena's and BCE's agreements, citing concerns about the expropriation of their assets.

Statistics:

  • $200 million: approximate value of the transfer of BCE's interests in Brookfield to Carena.
  • $175 million: value of BCE's equity in the landmark office tower transferred to Carena.
  • $25 million: value of BF Realty debentures transferred to Carena.
  • $700 million: amount of new loans invested by BCE and Carena into Brookfield in 1989.
  • $100 million: additional investment made by Carena in Brookfield.
  • $500 million: approximate amount of debt owed by BF Realty Holdings Ltd.
  • $10 million: approximate value of BF Realty's assets.
  • 100%: percentage of control Carena now has over Brookfield Development Corp.

Sources:

  • The Globe and Mail
  • BCE Inc.
  • Carena Developments Ltd.
  • BF Realty Holdings Ltd.