Morton College successfully closed on a bond sale transaction that will generate over $9 million for use by the College for capital improvements throughout the campus.
“Our college community deserve these investments,” said Stan Fields, Morton College President. “High quality living and learning facilities are critical to preparing our students to succeed in a competitive global economy. The bond sale will fund improvements to our facilities that will guarantee our students the college educational experience and value they so deserve. “
Working in conjunction with its legal and investment banking team, College officials managed the sale over a period of several months. On Wednesday May 29th, the College entered the market to sell bonds to finance the projects. The bond sale was well received by investors, garnering a true interest cost of 3.11%. The bonds will be repaid over a period of 20 years.
In the course of the sale, the College had over 1.5 times the numbers of orders for bonds than the College had bonds to sell. This high demand resulted from investor appetite for highly-rated credits in today’s market. Ultimately, the bonds were placed with four large, long-term buyers of municipal bonds.
Assisting the College in obtaining this low rate was the College’s excellent bond rating. Morton College’s healthy financial operations produced an excellent rating at AA- with a stable outlook from S&P Global Ratings. According to S&P, the AA- rating indicates Morton College shows a very strong capacity to meet financial commitments. This enabled the College to pay a lower interest rate on the bonds. Morton College’s solid operating fund balance also played an important factor in earning the strong rating.
“This is an excellent rating and rare for issuers in Illinois,” said Brian King of Cabrera Capital, the bond underwriters. “This is a credit to the work and dedication shown by all in managing the College.”
Morton College intends to use the roughly $9 million series 2019 bond proceeds to fund various renovations and repair projects on its campus which will address some of its critical deferred maintenance needs, and also fund issuance costs.
Morton College’s Board of Trustees adopted a resolution at its March meeting to authorize district officials to issue debt.