Texas A&M prices $349.73 million; Massachusetts plans $526.78 million; trading at holiday levels

By Aaron Hochman-Zimmerman

New York, Feb. 12 - The municipal marketplace eased toward an abbreviated session on Friday although the Texas A&M University System managed to price $349.725 million bonds.

The Commonwealth of Massachusetts made future plans to sell $526.78 million, but the State of Oregon Department of Administrative Services was not as well received.

Oregon pulled the $229.4 million deal it had scheduled to price on Thursday.

Meanwhile on the trading side, "rates have come down quite a bit and there's not much to work with," a senior trader said.

The trader acknowledged the large amount of "technical uncertainty" as Washington, D.C., continued to hammer out and bend the stimulus plan, but he confessed that much of the day's light activity was due to people running out for Presidents Day vacations.

What was trading was at the opposite ends of the bond spectrum, he said.

Some investors sought the security of highly rated credits, but others found too little upside potential outside of very high-yielding credits, he said.

The market is burning at both ends.

Aggies' $349.73 million bumper crop

Meanwhile, the Texas A&M University System priced $349.725 million series 2009 revenue financing system bonds (Aa1/AA+/), according to treasurer Gregory Anderson.

The bonds priced with a true interest cost of 4.10% and a yield range of 0.88% to 5.04%.

"It went very well for us," Anderson said, "better than we were expecting."

The negotiated deal came in two tranches.

J.P. Morgan Securities Inc. acted the underwriter for the $270.96 million series 2009A bonds, and Morgan Keegan & Co. Inc. was the underwriter for the $78.765 million series 2009B bonds.

"Both did an excellent job for us," he said about JPMorgan and Morgan Keegan.

The series A bonds carry maturities from 2010 to 2019, and the series B bonds extend from 2010 to 2029.

Two term bonds will mature in 2034 and 2039.

Proceeds will be used to construct, equip and acquire facilities and refinance existing commercial paper.

Texas A&M University is based in College Station.

Oregon sale delayed

Out west, the State of Oregon Department of Administrative Services has delayed the sale of its $229.4 million in series 2009A and 2009B certificates of participation, said a sellside source close to the deal.

The issuer, according to the source, is holding out for more favorable market conditions.

"They weren't able to get the kind of rates they were looking for, so we've taken it off for today," he said.

"No new date has been set at this time."

The offering includes $214.14 million in series 2009A COPs and $15.26 million in series 2009B COPs.

The 2009A COPs are due 2010 to 2028 with term bonds due 2033 and 2039. The 2009B COPs are due 2018 and 2023.

Proceeds will fund the expansion and improvement of a state psychiatric hospital.

Virginia Housing sale prices

In pricing news, the Virginia Housing Development Authority priced $72.915 million in series 2009A taxable rental housing bonds, said an official statement released Thursday.

The bonds (Aa1/AA+/) priced Wednesday through lead manager Morgan Keegan.

The bonds are due 2011 to 2023 with term bonds due 2029 and 2039. The serials have coupons from 3.29% to 5.8%. The 2029 bonds have a 6.75% coupon, priced at 97.853, and the 2039 bonds have a 7% coupon, priced at 98.763.

Proceeds will be used for housing loans.

Massachusetts to sell $526.78 million

Moving to upcoming sales, the Commonwealth of Massachusetts announced plans Thursday to price $526.78 million in series 2009A general obligation and general obligation refunding bonds.

The sale includes $430.315 million in series 2009A G.O.s and $96.465 million in series 2009A G.O. refunding bonds, said a preliminary official statement.

Goldman, Sachs & Co. is the senior manager for the sale.

The 2009A G.O.s are due from 2010 to 2029 with term bonds due 2034 and 2039. The 2009A G.O. refunding bonds are due 2010 to 2022.

Proceeds will be used for capital expenditures and refunding existing debt.

JEA deal coming up

Also ahead, JEA in Florida is expected to price another offering, this time $273.565 million in series 2009 electric system revenue bonds, said a preliminary official statement.

The authority sold $128.31 million in water and sewer bonds earlier this week.

The sale includes $75.06 million in series 2009A-3 electric system revenue bonds and $198.505 million in series 2009B electric system subordinated revenue bonds.

The bonds will be sold through senior manager Morgan Stanley & Co. Inc.

The maturities have not been set for the offering yet.

Proceeds will be used to refund existing debt and make a deposit to a debt service reserve fund and a construction reserve fund.

JEA is based out of Jacksonville.

Onondaga's competitive deal

Also coming up, Onondaga County of New York plans to price $61.725 million in series 2009A G.O. bonds on Feb. 24, said a preliminary official statement.

The bonds (Aa2/AA+/AA+) will be sold on a competitive basis with Fiscal Advisors and Marketing Inc. and Government Finance Associates Inc. as the financial advisers.

The bonds are due 2011 to 2029.

Proceeds will be used to renovate courthouses, construct zoos and hotel projects, purchase radios and radio infrastructure and build parks.

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