FOR IMMEDIATE RELEASE
On Thursday, September 13, 2012, the State of Illinois successfully sold $50,000,000 of General Obligation Bonds on a competitive basis using Grant Street Group's MuniAuction® platform.
"...we are confident that the open auction system was the best method given the size and duration of the Bonds, and especially given the large number of participating underwriters"
James Prichard, Manager of Capital Markets for the State
During the auction, 18 competing underwriters submitted a total of 94 bids. Using MuniAuction's proprietary open auction process, each time an underwriter submitted a bid, it and all other underwriters who had previously bid instantaneously learned their rank. Underwriters then had the option to either hold or improve their bid (i.e., lower their True Interest Cost, or "TIC") in an effort to win the Bonds.
"Today's sale was successful. This is the first time the State has used Grant Street's platform and we are confident that the open auction system was the best method given the size and duration of the Bonds, and especially given the large number of participating underwriters. Historically, the State has seen 7 - 10 underwriters bid on prior competitive sales," said James Prichard, Manager of Capital Markets for the State.
The auction was extended 13 times as the leading bid changed during the last two minutes of the auction. 58 total bids came in during the auction overtime, including the winning bid. In the end, Raymond James | Morgan Keegan won the Bonds by improving, then submitting the bid with the lowest TIC of 2.491591%.
"This is another dramatic illustration of the benefits issuers realize from conducting open auctions. Earlier this week, Kane County Illinois Forest Preserve District had a similar experience with their $72 million offering," said John McCarthy of Grant Street Group.
A replay of the State of Illinois' auction is available at the following link: http://tinyurl.com/Illinois-2012-Bonds.
