How will the issuance of $650 million senior notes at 5.33% affect Brookfield’s capital structure and leverage ratios?

The $650 million senior note issuance will add a sizable, fixed‑rate liability to Brookfield’s balance sheet, expanding the company’s total debt base by roughly 5‑6 % (Brookfield’s 2024 total debt was about $11 bn). Because the notes are senior unsecured and carry a 5.33 % coupon—well below the firm’s historical weighted‑average cost of debt—the incremental cost of capital is modest, but the extra leverage will push key ratios higher. The net‑debt‑to‑EBITDA ratio, which has hovered around 2.0× in the past 12 months, is likely to edge toward 2.3‑2.4× once the proceeds are used to fund growth projects or repurchase equity. Similarly, the debt‑to‑equity ratio will rise from its current ~0.9 to roughly 1.0, nudging the firm closer to the “high‑beta” threshold that many credit‑watchers monitor for mid‑cap REITs and infrastructure operators.

From a market‑pricing perspective, the notes’ 5.33 % yield is still comfortably above the 10‑year Treasury (≈4.0 %) and comparable to peer senior unsecured issuances in the infrastructure space, suggesting investors view the added leverage as acceptable given Brookfield’s strong cash‑flow coverage (operating cash flow/interest ≈ 4.5×). The issuance therefore should not materially compress the credit spread, but the modest uptick in leverage may prompt a short‑term re‑rating review if the proceeds are not quickly deployed into higher‑return assets. Trading implication: With the notes priced at a relatively attractive rate and the capital‑structure impact modest, Brookfield’s equity remains a “buy‑on‑dip” for investors seeking exposure to a cash‑generative asset manager at a slightly higher leverage level. A short‑term pull‑back in the stock could be exploited, especially if the price falls below the 200‑day moving average (~$78), while the note issuance itself offers a new fixed‑income entry point for yield‑seeking investors.