Public Finance

University of Georgia Athletic Association

By leveraging financial strengths, the University of Georgia Athletic Association and Stephens strategized a winning program.

Role: Sole Manager
Amount: $60,175,000
Date: 2016
Client: University of Georgia Athletic Association
Industry: Education

The Southeastern Conference (SEC) is regarded by many as the most competitive in intercollegiate athletics. The University of Georgia Bulldogs, one of the conference’s most respected programs, are perennial contenders, having won 42 national championships in sports ranging from baseball, football and tennis to gymnastics, golf and equestrian. All told, the University has won a total of 155 SEC Championships.  

The University of Georgia Athletic Association has made adding to their conference and national titles a top priority, in all sports. In an effort to meet this objective, the University has placed a keen focus on financial prudence. The results of which have enabled them to invest in a series of enhancements throughout their athletic program, including adding new coaching staffs and constructing new training and competition venues.

Investment Bankers at Stephens have worked with the Athletic Association since 2003, executing five transactions in that time. When the University set out to achieve its stated goal of winning additional SEC and national championships, Stephens provided strategic financial benchmarking information, financial structuring recommendations and monitored refunding opportunities to assist the program to meet its goals. Stephens evaluated the top 25 national athletic programs in United States and all of the SEC programs in an effort to benchmark the University of Georgia against similar schools and programs. Stephens evaluated program debt structures, football program revenues and expenses and other critical factors to determine if the University of Georgia Athletic Association was competing financially as well as athletically against its peers. Stephens found that University compared very well financially to the top national and SEC athletic programs. A result of the analysis allowed the Athletic Association to receive a very strong stand-alone bond rating, independent of the University, of Aa3 from Moody’s Investor’s Services.    

By monitoring the Athletic Association’s debt profile, Stephens recently recommended that the Bulldogs refund two variable bond issues and a 2011 fixed rate bond issue due to favorable current market conditions. Stephens served as the sole managing underwriter of the refunding. The financing allowed the Athletic Association to realize gross refunding savings of $5.4 million. A portion of the refunding savings was utilized to pay swap termination payments related to the refunded variable rate debt. In addition, the Athletic Association was able to significantly change its variable rate debt exposure as part of the entire debt portfolio profile from 40% to 24%, and did so at a lower cost.  

The University of Georgia is one of the most financially sound athletic programs in the country. They are leveraging their financial strengths to position all of its sports programs to win. The University is working toward its long-term goals of winning SEC and national championships. In the process, they’ve made their athletic programs even more financially sound. Next stop: multiple SEC and national championships.

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