Australia's Babcock & Brown Infrastructure Group has revealed a AUS$1.8bn (£1.01bn) recapitalization plan that will allow Canada's Brookfield Asset Management to take a stake of up to 39.9% in the firm.
The deal also allows it to buy key assets from Babcock.
The move involves raising A$1.5bn (£848m) from the sale of new shares, including a A$625m (£353m) placement to Brookfield.
Current Babcock & Brown Infrastructure security holders would get a capital distribution of four Australian cents a security, and, if they do not participate in the equity raising, would end up with just zero to 0.1% of the recapitalized entity.
Babcock & Brown Infrastructure has been struggling under A$9.1bn (£5.1bn) of debt and had been looking to unload assets it acquired before the onset of the global financial crisis to help meet repayments.
Babcock & Brown Infrastructure would be renamed Prime Infrastructure once its management agreement with its former parent Babcock & Brown is terminated.
In addition to the placement to Brookfield, Babcock & Brown Infrastructure plans a A$625m (£353m) placement to institutional investors and a A$250m (£141m) security purchase plan, both fully underwritten by Credit Suisse Group and Macquarie Group.