LOS ANGELES - California sold $750 million of general obligation bonds in two competitive offerings on Tuesday, with Wells Fargo Bank submitting both winning bids.
The state priced $575 million of tax-exempt bonds and $175 million of taxable bonds. Wells Fargo won the bidding on both portions of the deal, with an overall true interest cost of 3.7147% on the tax-exempt bonds and 2.144% on the taxable bonds.
"This is an excellent result for taxpayers, and it shows California's bonds continue to gain strength in the market," State Treasurer Bill Lockyer said in a statement. "The prices are better than we expected, and the yields we received beat secondary market prices. Now, our GO program can take a little breather while the Governor and Legislature work to craft the State's FY 2014-15 budget."
Proceeds from the tax-exempt bonds will finance transportation projects. The taxable portion includes $80 million of new money for the state's stem cell research program, $81.4 million to pay off previously issued commercial paper that raised funds for the stem cell program, and $13.6 million to pay down commercial paper issued for the state's K-12 charter school loan program.
The bonds carried A ratings by both Standard & Poor's and Fitch Ratings, and an A1 rating from Moody's Investors Service.
Orrick, Herrington & Sutcliffe LLP served as bond counsel on the deal. Public Resources Advisory Group was financial advisor.
