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In Michigan,
Market Keen to Watch Investment-Grade Charter School Deal
Excerpt from a 12/1/05 The Bond Buyer article by
Elizabeth Carvlin; as distributed from the Michigan Association
of Public School Academies
For more articles like this
visit
http://www.bridges4kids.org.
The Public
Educational Facilities Authority will bring to market its first
fixed-rate, long-term bond issue on behalf of a charter school
in a deal set for next week that won an investment-grade rating
despite a limit on the use of state aid for debt repayment.
The authority will issue $10.9 million of limited obligation
revenue bonds in two series on behalf of the Old Redford
Academy, a K-12 charter school in Detroit authorized through
Central Michigan University. The proceeds will be used to buy
the existing elementary school and build an addition that will
allow the school to eliminate portable classrooms. The deal is
set for Wednesday. With this transaction, NatCity Investments
Inc. jumps into the arena of underwriting on behalf of charters.
A.G. Edwards & Sons Inc. has led sales for charters in the
state, and Fifth Third Securities Inc. also has worked on deals
with the authority. Dickinson Wright PLLC is bond counsel and
underwriters' counsel is Clark Hill PLC.
Bond professionals will be watching if they price differently
from the other bonds. A.G. Edwards recently priced a $13.8
million deal on behalf of the Plymouth Educational Center. The
30-year bonds brought a 5.375% coupon and yielded 5.52%, said
Tedla of NatCity. That shows significant improvement from
earlier charter school sales that were as high as 8%, according
to Ridley.
Read more at:
http://www.bondbuyer.com/index.html
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