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Brookfield to buy remaining 60% of Prime Infrastructure

Monday 23rd August 2010

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Units of Prime Infrastructure, the investment group that emerged from the recapitalisation of Babcock & Brown Infrastructure, soared 21% after its biggest shareholder agreed to buy the remaining 60%.

Investors in Prime’s stapled securities will receive 0.24 Brookfield Infrastructure Partners units for each Prime stapled security held, representing a price of A$4.60 apiece, or A$1.6 billion. The units of Prime surged 76 cents to $4.36 on the ASX today.

Smaller investors in Prime have the option of taking A$4.55 cash in lieu of Brookfield unit up to a limit of 4,000 Prime units. The units of Bermuda-based, NYSE-listed Brookfield rose 0.4% to US$ $17.15 on Friday.

“This merger provides significant benefits to investors of both Prime and Brookfield Infrastructure,” said Brookfield chief executive Sam Pollock.

His firm had been encouraged to make a full takeover by “a number of large prime investors,” he said.

The proposal has been recommended by Prime’s independent directors in the absence of a better offer and subject to an independent assessment from advisory firm Grant Samuel.

Prime separately reported a full-year profit from continuing operations of A$32 million compared to a loss of A$252.9 million a year earlier.

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