December 5, 2019
Sachin Shah
Chief Executive Officer
Brookfield Renewable Corporation
250 Vesey Street, 15th Floor
New York, New York 10281-1023
Re: Brookfield Renewable Corporation
Brookfield Renewable Partners L.P.
Registration Statement on Form F-1
Filed November 8, 2019
File No. 333-234614
Dear Mr. Shah:
We have reviewed your registration statement and have the following
comments. In
some of our comments, we may ask you to provide us with information so we may
better
understand your disclosure.
Please respond to this letter by amending your registration statement
and providing the
requested information. If you do not believe our comments apply to your facts
and
circumstances or do not believe an amendment is appropriate, please tell us why
in your
response.
After reviewing any amendment to your registration statement and the
information you
provide in response to these comments, we may have additional comments.
Registration Statement on Form F-1 filed November 8, 2019
Cover Page
1. You disclose here and throughout your prospectus that each class A share
will receive
"identical" dividends to, or dividends in the "same amount" as, the
distributions paid on
each unit. From disclosure on page 4 it appears that the aggregate
distribution received by
a holder on its units and class A shares will be the same as if the
special distribution had
not been made, with distributions on the units representing four-fifths
(4/5ths) of such
aggregate amount, and by extension, distributions on the class A shares
representing one-
fifth (1/5th) of such aggregate amount. If correct, please revise to
clarify throughout your
prospectus that such distributions will only be identical or the same
for a holder of the
securities in the aggregate. Please also clarify at the appropriate
place the level of the
Sachin Shah
FirstName LastNameSachin Shah
Brookfield Renewable Corporation
Comapany5, 2019
December NameBrookfield Renewable Corporation
December 5, 2019 Page 2
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FirstName LastName
group's aggregate distribution a unitholder would receive if such
holder exchanged all
class A shares for units. For example, clarify if a unitholder in that
instance would
thereafter only receive 4/5ths of the group's aggregate distribution.
2. Please disclose on your prospectus cover page your capital stock
structure and the number
of votes per share to which each class of shares is entitled. In this
regard, disclose that
holders of class B shares will be entitled to cast, in the aggregate,
a number of votes equal
to three times the number of votes attached to the class A shares.
Questions and Answers Regarding the Special Distribution
How will owning a class A share be different from owning a unit?, page 7
3. You disclose throughout the prospectus that each class A share will be
structured with the
intention of providing an economic return equivalent to one unit,
"subject to adjustment to
reflect certain capital events." We further note the disclosures on
page 144. Please revise
to describe these capital events which may impact the exchange ratio.
4. Please revise to clarify here that you and the partnership currently
intend to satisfy any
exchange requests on the class A shares through the delivery of units
rather than cash.
Our Business, page 11
5. You disclose here and in your business section that your current
operations consist of
approximately 3,468 MW of installed hydroelectric capacity. However,
you disclose
having 3,768 MW of capacity at June 30, 2019 according to the tabular
disclosure on page
60. Please reconcile the conflicting disclosures.
Current Operations
Columbia, page 12
6. We note your disclosure here and on page 62 and F-24 that your
"consortium's" current
ownership in Isagen is 99.63%, of which your share is approximately
24.17%. Please
explain the nature of your investment in Isagen and clarify if your
24.17% interest refers
to your economic interest in Isagen.
Summary
Management Fee and Incentive Distributions, page 18
7. Please revise to clarify how you will calculate the proportionate
share of the base
management fee that you will be responsible for reimbursing Brookfield
Renewable. For
example, we note that your carve-out financial statements disclose
"management service
costs" of $26 million in 2018, from a total base management fee
disclosed on page 109 of
$80 million in 2018.
Sachin Shah
FirstName LastNameSachin Shah
Brookfield Renewable Corporation
Comapany5, 2019
December NameBrookfield Renewable Corporation
December 5, 2019 Page 3
Page 3
FirstName LastName
Risk Factors
Risks Related to the Class A Shares
Our company may redeem the class A shares at any time without the consent of
the holders, page
25
8. We note disclosure here that your board may elect to redeem all of the
then outstanding
class A shares "at any time upon sixty (60) days' prior written
notice" for certain events,
including the enumerated redemption events on page 25. Please revise
to clarify if the
board could decide to redeem all of the then outstanding class A
shares only upon the
listed redemption events or for any particular reason.
Management's Discussion and Analysis of Financial Condition and Results of
Operations
("MD&A"), page 67
9. Please revise here or in your business section to disclose the amount
invested in capital
expenditures and divestures for the financial periods presented. Your
presentation should
also include the information concerning the principal capital
expenditures currently in
progress and the method of financing. See Item 4.A.5 and 6 of Form
20-F. In this regard,
we note that under Note 22 on page F-45 you disclose certain capital
expenditure
commitments at December 31, 2018.
Columbia, page 74
10. In the last paragraph on this page and in the penultimate paragraph on
page 75 you
reference that funds from operations in various financial periods
materially changed in
part due to changes or a lack thereof in "same-store" generation.
Please revise to disclose
how you determine same-store generation.
Governance
The Board of Directors, page 94
11. Please disclose the principal business activities performed by your
officers and directors
to also include those performed outside from your company (including,
in the case of
directors, other principal directorships). For example, please
disclose that Mr. Blidner is
also a director of Brookfield Infrastructure Partners LP and a
proposed director of
Brookfield Infrastructure Corp. See Item 6.A.2 of Form 20-F.
Material United States Federal Income Tax Considerations, page 178
12. We note your disclosure on page 179 that the following discussion, to
the extent it express
conclusions as to the application of U.S. federal income tax law,
represents the opinion of
Torys LLP. However, you state on page 180 that "[b]ased on the
foregoing, the general
partner of the partnership believes that the partnership will be
treated as a partnership and
not as a corporation for U.S. federal income tax purposes." Please
revise to include the
Sachin Shah
Brookfield Renewable Corporation
December 5, 2019
Page 4
opinion of tax counsel here. You also disclose that Torys LLP has
rendered no opinion as
to a list of tax matters that appear to be legal conclusions that
determine whether a
partner's receipt of a distribution of property is generally not taxable
and thereafter
whether an exchange of class A shares for units will qualify as tax-free.
We further note
your disclosure throughout that you believe this transaction should not
be taxable and that
dividends are expected to be qualified for U.S. investors. Please revise
to have counsel
clearly identify and articulate each material tax consequence being
opined upon. If there
is significant doubt about the tax consequences of the transaction,
counsel may issue a
"should" or "more likely than not" opinion to make clear that the opinion
is subject to a
degree of uncertainty. Please have counsel revise the tax opinion
accordingly. Refer to
Section III.C.3 and 4 of Staff Legal Bulletin No. 19 for guidance.
We remind you that the company and its management are responsible for
the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Refer to Rules 460 and 461 regarding requests for acceleration. Please
allow adequate
time for us to review any amendment prior to the requested effective date of
the registration
statement.
You may contact Mark Wojciechowski at (202) 551-3759 or Jenifer
Gallagher at (202)
551-3706 if you have questions regarding comments on the financial statements
and related
matters. Please contact Kevin Dougherty, Staff Attorney, at (202) 551-3271 or
Loan Lauren
Nguyen, Legal Branch Chief, at (202) 551-3642 with any other questions.
Sincerely,
FirstName LastNameSachin Shah
Division of
Corporation Finance
Comapany NameBrookfield Renewable Corporation
Office of Energy &
Transportation
December 5, 2019 Page 4
cc: Mile T. Kurta
FirstName LastName