Memphis, Tenn., home of the famous Beale Street, recently closed a GO bond deal.

BRADENTON, Fla. - Memphis, Tenn., recently closed on the sale of $208 million of general obligation bonds after a marketing effort that allowed underwriters to drop yields.

The double-A rated deal was the city's largest ever GO bond issue in a single series, and nearly 25% of the investors were from the retail sector, according to book-running senior manager Duncan-Williams Inc. The firm is headquartered in Memphis.

The tax-exempt offering sold at a true interest cost of 4.15%. Bond proceeds were used to retire short-term bond anticipation notes and commercial paper issued to finance nearly 300 capital projects. The deal priced March 13, and closed March 25.

The bonds are rated Aa2 by Moody's Investors Service and AA by Standard & Poor's.

"Our marketing efforts were so robust we were able to drop the bond yields an overall average of 5 basis points on the issue," said Angela Himelright, underwriter on the deal at Duncan-Williams.

Bonds maturing in 2015 priced to yield 0.19% with a 5% coupon at a spread of 4.8 basis points to the Municipal Market Data triple-A scale. Bonds maturing in 2031 priced to yield 3.73% with a 5% coupon at a spread of 45 basis points, and a 2044 maturity yielded 4.19% with a 5% coupon at a spread of 43 basis points.

"The city of Memphis made efficient use of short-term financing at low interest rates during construction of the projects, thus minimizing interest carry during that time," said Duncan's lead banker Wayne Breunig. "Locking in currently low long-term rates, and maturities matched with the useful lives of the projects, is an appropriate means of financing long term infrastructure."

FirstSouthwest Co. and ComCap Advisors were co-financial advisors on the deal.

Other underwriters were Harvestons Securities Inc., Piper Jaffray & Co., Raymond James & Associates Inc., and SunTrust Robinson Humphrey.

Hawkins, Delafield & Wood LLP was bond counsel. Hagler Bruce & Turner PLLC and Greenberg Traurig LLP were co-disclosure counsel. Underwriters' counsel was Bass, Berry & Sims PLC.

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