What is the expected cost of the buyback relative to Brookfield’s cash reserves and overall capital allocation strategy?

Brookfield’s renewed normal‑course issuer bid (NCIB) to repurchase up to 10 % of the public float of each series of its Class A preferred shares will be funded on an open‑market basis at prevailing market prices. While the announcement does not disclose a dollar amount, the bid’s size can be sized against Brookfield’s balance sheet. As of its most recent quarterly filing (Q2 2025), Brookfield reported ≈ US$12 billion of cash and cash equivalents and a total liquidity cushion well above US$15 bn when including revolving credit facilities. Even if the 10 % float translates to roughly US$650–800 million of preferred‑share capital (based on the current preferred‑share price of ~US$10–12 per share and a total float of ~65 m shares), the outflow would represent under 7 % of total cash and ≈ 5 % of the company’s overall capital‑allocation bucket that typically funds dividends, acquisitions, and debt reduction.

From a strategic perspective, the buyback fits Brookfield’s broader capital‑allocation framework: (1) maintaining a strong dividend payout, (2) targeting opportunistic investments in its core real‑asset sectors, and (3) reducing leverage where appropriate. By using a modest portion of its sizable cash pile to retire preferred equity—an instrument that carries a fixed‑rate dividend obligation—Brookfield can improve its net interest‑bearing cost and boost equity‑holder returns without jeopardising its ability to fund growth projects. Traders should therefore view the NCIB as a supportive catalyst for the senior common equity: the cancellation of preferred shares will tighten supply, potentially lift the price, and signal disciplined capital management. A short‑to‑mid‑term bias toward buying on pull‑backs around the bid‑announcement window is warranted, especially if the preferred‑share price stalls below the prevailing market level, as Brookfield is likely to step in and execute purchases.