CHICAGO — Kent State University will come to market Thursday with $170 million of new-money bonds that will raise funds for a large capital plan at the school’s main campus in Kent, Ohio.

The deal will feature 30-year fixed-rate bonds backed by the university’s general receipts. It’s Kent State’s first sale since 2009, and they will enter what’s expected to be one of the busiest weeks of the year.

“It’s been awhile since the university has been in the marketplace, and it’s an important transaction,” said Bethany Pugh with Public Financial Management Inc., the school’s financial advisor. “We’re hoping for good market penetration while the market is still at historic lows.”

Bank of America-Merrill Lynch is senior manager and Keybank Capital Markets Inc. is co-senior. Seven additional firms round out the team. Roetzel & Andress LPA is bond counsel.

Kent State is located in northeastern Ohio and is one of its three largest state-supported universities. It has seven campuses and reported a 2010 enrollment of 41,300 students.

Officials had originally hoped to issue debt backed by a new student fee, but abandoned the plan amid opposition from state officials and lawmakers. Instead, the school increased tuition by 3.5% last year and implemented a new fee for certain courses that will also boost revenue.

The capital projects financed by the bond issue, as well as a $30 million issue planned for later this year, will help keep Kent State competitive in the Ohio higher education landscape, according to Moody’s Investors Service, which says the university has a high average-building age of 13 years.

“The current state of many of our academic buildings does not meet with our academic goals,” said Kent State spokeswoman Emily Vincent.

Standard & Poor’s rates the university A-plus and Moody’s rates it Aa3.

The rating agencies noted that Kent State’s finances are stable, that it saw profitability in 2011 for the first time in three years, and that it has a strong market position and growing enrollment. But analysts warned new borrowing will increase debt by more than 54%, making future rating upgrades unlikely.

After the sale, Kent State will have $481 million of debt, up from $311 million. Of that, $436 million will be secured by the university’s general receipts, which include nearly all revenues except for state aid.

The school has $60 million of variable-rate bonds supported by a letter of credit from Bank of America NA that expires in 2014. The school is considering replacing the LOC, as it would face potential puts of the debt if B of A were downgraded.

The university last sold bonds in 2009 when it priced $215 million of debt insured by Assured Guaranty. Bonds with a 2018 maturity and 3.375% coupon were yielding 1.76% in recent trading. Bonds with a 2029 maturity and 5% coupon were yielding 3%.

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