Newspaper article THE JOURNAL RECORD

Agency Begins Closing Bond Issue

Newspaper article THE JOURNAL RECORD

Agency Begins Closing Bond Issue

Article excerpt

Closing on a $608.3 million Oklahoma Turnpike Authority revenue bond refinancing issue began Wednesday, with funds expected to be transferred to Oklahoma today.

In what was called "the most successful bond issue in the United States this year," financial and legal firms came to Oklahoma City to conclude the sale. This is believed to be the first time that a bond issue of this magnitude has been closed outside of New York City.

The sale also showed that the authority can sell bonds to Oklahomans, said Robert N. Cochran, executive vice president of Stifel, Nicolaus Co. Inc., conager of the underwriting team.

"There were a number of scoffers who said that there was no way to sell these bonds in Oklahoma," he told the authority members during a special session in Oklahoma City to confirm the sale. "They felt maybe we could sell 10 percent. But these bonds have been accepted in the state.

"The authority did a good job of prelling and showed its ability to sell bonds in this state. There's no reason to sell anything but turnpike bonds now."

About 30 percent of the bonds, worth from $180 million to $200 million, was sold in Oklahoma, according to Jack Addams, managing director of Merrill Lynch Co., the other conager of the program.

"This was a very successful sale," said Chief Executive Officer Richard L. Ridings. "We have an overall 6.39 percent true interest rate, which means that we will save $30 million immediately and about $197 million over the 30-year life of the bonds.

"I think this is the most successful bond sale in the United States this year."

Along with the lower interest rates, the authority's bond ratings were upgraded by both Moody's Investor's Service and Standard Poor's, Cochran said. He added that he expected to receive a AA rating for the bonds from Moody's within a year.

There were no dissenting votes on the resolution confirming the sale, although only four of the authority's seven members attended.

Bonds were sold to refinance $558.4 million worth of bonds sold in February 1989 to take advantage of dropping interest rates. The old bonds carried a true interest rate of 7.822 percent. Oklahoma's 10 toll roads and income from toll fees were used as collateral in both bond issues. …

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