The University of South Alabama sold $92.7 million in bonds to refund previously issued securities.
The university issued $72.8 million in tax-exempt bonds and $19.9 million in taxable bonds. The tax-exempt bonds mature between 2035 and 2054, yielding between 3.25% and 4.15%. The taxable bonds mature between 2025 and 2035, yielding between 4.753% and 5.233%.
The securities received an insured rating of AA from S&P Global Ratings and an underlying rating of A+ from S&P and A1 from Moody’s Investors Service, which revised the university’s outlook to stable from negative.
“The revision of the outlook to stable from negative reflects expectations of maintenance of operating performance, positive enrollment trends and liquidity,” Moody’s analysts wrote.
The university will use the issuance proceeds to refund bonds that it sold last year.
The University of South Alabama enrolls some 13,768 students at its campus in Mobile. It also operates an academic medical center that includes three hospitals. The bonds are special and limited obligations of the university, secured by tuition revenue and some hospital revenue.
J.P. Morgan Securities LLC served as lead underwriter on the issuance, purchasing the bonds for almost $100 million. The price reflected a premium of $7 million. PFM Financial Advisors LLC acted as municipal advisor.