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MassDevelopment
2010 Conference
MassDevelopment 2010 Conference
Communicating with Debt Stakeholders
October, 2010
MassDevelopment
2010 Conference
Higher Education Constituencies
2
• Trustees
• Administration
• Faculty
• Employees
• Stud...
MassDevelopment
2010 Conference
Investors!
3
$76 $73 $69 $66 $62
$11 $24 $46
$70
$96
$120
$154
$183
$215
$251
$286
$97 $93...
MassDevelopment
2010 Conference
Massachusetts Higher Ed Issuance (New Money)
4
$897 $747
$1,861
$689
$3,477
$4,434
$5,697
...
MassDevelopment
2010 Conference
Recent Areas of Focus by Investors
5
• Specific legal security
• Priority of payment
• Str...
MassDevelopment
2010 Conference
Appendix A
6
• Most important document for investors
• Most important document for disclos...
MassDevelopment
2010 Conference
Investor Presentations
7
• Only information in Preliminary Official Statement (POS)
• Topi...
MassDevelopment
2010 Conference
Investor Dialogue
8
• Forms of dialogue
– Continuing disclosure filings
– Investor present...
MassDevelopment
2010 Conference
Series 2010 Investor Presentation
September 2010
$65,000,000* Tax-Exempt
Massachusetts Dev...
MassDevelopment
2010 Conference
Spring Disclosure
10
• Consideration being given to further ongoing investor disclosure
• ...
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4- Communicating with Debt Stakeholders- Matt Pearson & Jason Potts

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An overview of the current strategies for higher education institutions to communicate with investors and approach financing, by Matt Pearson of Morgan Stanley and Jason Potts of Suffolk University. part of Current Topics in Tax-Exempt Finance 10/29/2010

Published in: Economy & Finance, Business
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Transcript of "4- Communicating with Debt Stakeholders- Matt Pearson & Jason Potts"

  1. 1. MassDevelopment 2010 Conference MassDevelopment 2010 Conference Communicating with Debt Stakeholders October, 2010
  2. 2. MassDevelopment 2010 Conference Higher Education Constituencies 2 • Trustees • Administration • Faculty • Employees • Students • Parents • Alumni • Local residents and businesses
  3. 3. MassDevelopment 2010 Conference Investors! 3 $76 $73 $69 $66 $62 $11 $24 $46 $70 $96 $120 $154 $183 $215 $251 $286 $97 $93 $90 $87 $83 $80 $0 $50 $100 $150 $200 $250 $300 $350 $400 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Source Thompson Reuters Outstanding Higher Education Debt Estimated at ~ $286 billion ($Billions)
  4. 4. MassDevelopment 2010 Conference Massachusetts Higher Ed Issuance (New Money) 4 $897 $747 $1,861 $689 $3,477 $4,434 $5,697 $6,854 $7,627 $8,304 $9,201 $9,948 $11,809 $12,498 $1,045 $957 $1,263 $1,157 $773 $677 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 New Money Issued Cumulative Debt Massachusetts Higher Education New Money Debt Issuance by Year 2000-2009 ($MM) Source Thompson Reuters
  5. 5. MassDevelopment 2010 Conference Recent Areas of Focus by Investors 5 • Specific legal security • Priority of payment • Strength of mortgage • Endowment performance • Variable rate debt (puts) • Tuition escalation • Availability of student loans • Hospitals / health care related ventures • More frequent disclosure is being requested • Future plans • Financial commitment
  6. 6. MassDevelopment 2010 Conference Appendix A 6 • Most important document for investors • Most important document for disclosure • Organized • Readable • Clear • Logical • Orderly • Strategic • Professional lay-out • Carefully worded • No extraneous information
  7. 7. MassDevelopment 2010 Conference Investor Presentations 7 • Only information in Preliminary Official Statement (POS) • Topics usually include – Welcome and introduction of the financing plan – Introduction of the speakers – Timing / more details of the transaction – Debt Structure including purpose and structural details of proposed borrowing – Key financial / balance sheet data – Breakdown of revenues and expenses – Enrollment Trends – Investment Portfolio – Strategic goals of the University Investor Presentation Alternatives • Slides only • Voice over (recorded) • Live investor call • Posted on Institution’s website • Posted on Bloomberg
  8. 8. MassDevelopment 2010 Conference Investor Dialogue 8 • Forms of dialogue – Continuing disclosure filings – Investor presentations – One-on-one meetings / conference calls / luncheon – Web sites designed for disclosure – Semi-annual conference calls – Fair dissemination of information through Bloomberg
  9. 9. MassDevelopment 2010 Conference Series 2010 Investor Presentation September 2010 $65,000,000* Tax-Exempt Massachusetts Development Finance Agency Revenue Bonds, Suffolk University Issue Series 2010 9
  10. 10. MassDevelopment 2010 Conference Spring Disclosure 10 • Consideration being given to further ongoing investor disclosure • Probably less need for highly rated borrowers to provide • Types of information being considered – Budget – Student enrollment – Investment values • Balancing benefit with burden – Consult with counsel – Underwriter – Investors No information from November to November
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