Brascan Corp. has announced a proposal to merge with Trilon Financial Corp.

Trilon, which is currently 70% owned by Brascan, provides asset management and merchant banking services. Trilon also conducts capital markets activities and has a growing business services operation.

The proposal represents a transaction price of approximately $17 per share in a combination of cash and stock. Trilon shareholders may elect to receive payment entirely in cash or Brascan shares or any combination to a maximum cash payment of $388 million and a maximum issuance of 11.4 million shares.

Following the conclusion of the transaction, Trilon will continue to operate as a wholly owned subsidiary of Brascan under the name of Brascan Financial Corp. and will continue to expand its asset management, merchant banking, business services and capital markets activities with the direct support of Brascan and its management team.

Bruce Flatt, president and CEO of Brascan, stated, “We are in the process of transforming Brascan from a multi-business holding company into a focused operating business with three key core operations which generate consistent and sustainable cash flows — real estate, financial services and power generation. Our strategy includes, where possible, 100% ownership of these principal operating businesses. This transaction furthers this strategy and follows the recent increase in ownership of our power generating assets to 100%. The merger of Trilon and Brascan gives us the opportunity to fully integrate the management and financial resources of both companies, establishing a stronger platform for future growth.”

The board of Trilon has established a committee of independent directors to review the merger proposal. It has retained TD Securities Inc. to offer a fairness opinion.