Texas A&M's $169.52 million revenue bonds price; University of California prices $248.86 million GOs

By Cristal Cody and Sheri Kasprzak

New York, Jan. 10 - Two bonds issued by educational institutions in California and Texas priced Wednesday.

A competitive bid for $169.52 million in revenue financing system bonds priced Thursday from The Board of Regents at the Texas A&M University System went to Citigroup.

The university selected Citigroup as the winning underwriter, based on a true interest cost and yield of 3.94%, Greg Anderson, Texas A&M's associate vice chancellor and treasurer, told Prospect News on Thursday.

The average coupon on the maturities is 4.88%, he said. The coupons ranged from 4.5% to 5%.

The series 2008 bonds (Aa1/AA+) have serial maturities from May 15, 2008 to May 15, 2037.

The bonds had 11 underwriters bidding for the deal, Anderson said.

"We just felt like Citigroup came through with a very aggressive bid," he said.

Proceeds will help fund new campus projects, including residential housing for West Texas A&M University and a wellness center for Texas A&M Corpus Christi.

The university may issue another bond after September, but nothing is scheduled, Anderson said.

University of California sells revenue bonds

Meanwhile the University of California issued $248.86 million in general revenue bonds.

The senior underwriter is Lehman Brothers. A representative of Lehman did not have information immediately available.

The true interest cost on $208.025 million in series L general revenue bonds was 4.5%, with a weighted average coupon of 4.91%, according to Jean Ham, senior finance officer for the university. The series L bonds mature in 2040.

The true interest cost on $36.845 million in the series M bonds was 3.69%, with a weighted average coupon of 4%. The bonds mature in 2023.

The university also issued $3.99 million in taxable series N bonds, with a true interest cost of 4.84%, and a weighted average coupon of 4.77%. The bonds mature in 2020.

The university will use the proceeds to finance and refinance 28 capital projects on eight campuses, Ham said.

Spring ISD gets 3½%-5% coupons

The Spring Independent School District in Harris County, Texas, priced $142.29 million in unlimited tax schoolhouse and refunding bonds, series 2008 A, on Wednesday.

The deal does not close until the first week of February, said Karlos Allen, public finance associate with RBC Capital Markets, the district's financial advisor.

The senior underwriter is First Southwest Co.

The bonds have serial maturities from 2010 to 2028, with a yield of 3.804%. The coupon ranges from 3½% to 5% on each of the maturities, Allen said.

The proceeds will be used to construct and renovate schools, purchase new school buses and refund a portion of the district's outstanding unlimited tax bonds.

Nassau County to price next week

Coming up next week, New York's Nassau County will sell $125 million in competitive general obligation bonds series 2008 on Tuesday.

The tax-exempt bonds (A2/A/A+) include $105 million in general improvement bonds, 2008 series A, and $20 million in sewer and storm water resources district bonds, series B.

The county's bond financial advisor is Public Financial Management Inc. of New York. A spokesman with Public Financial said the series A bonds have consecutive serial maturities from 2009 to 2028, and the series B bonds mature from 2009 to 2033.

Montefiore to bring $165 million

Elsewhere, the Dormitory Authority of the State of New York/Montefiore Medical Center confirmed Thursday that it will price $165 million in mortgage hospital revenue bonds.

The bonds are expected to price next week, though no pricing date has been set at this time, Marc Violette, spokesman for the authority, said Thursday.

Merrill Lynch & Co. is the lead manager with Banc of America Securities LLC; Goldman, Sachs & Co.; JPMorgan; Piper Jaffray & Co.; Ramirez & Co., Inc; and Roosevelt & Cross, Inc. as co-managers.

The majority of the proceeds from the bonds will refund the outstanding $140.58 million in 1995 series A bonds.

The bonds are structured with serial maturities from August 2008 through August 2032.

Violette said the authority's board approved those bonds back in November.

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