Louisiana State Bond Buyers Met by Insolvency Plan Next Day
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Investors who bought $114 million of debt sold by Louisiana State University on Wednesday were warned about the state’s fiscal struggles. What they weren’t explicitly told in bond offering documents was that the school was considering filing for exigency.
Officials at the Baton Rouge-based school said they plan to draw up a financial exigency plan, equivalent to college bankruptcy, in the wake of $608 million in budget cuts proposed by Governor Bobby Jindal. For those who analyzed offering documents, the first item listed under bondholders’ risks now takes on added meaning.