Wall Street has reacted positively to the July merger of the University of Toledo and the Medical University of Ohio.
With $194 million in outstanding bonds, UT will benefit from 'positive momentum and potential academic, research, and fund-raising synergies from the merger,' making its debt less risky for investors, concluded Standard & Poor's, a ratings agency.
In September, S&P upgraded $50 million in premerger MUO bonds to high quality from upper medium quality. Moody's Investors Service, the finance industry's other dominant ratings agency, affirmed a similar rating for UT debt in August.
The higher rating lessens the cost of borrowing funds and allows the university to take on an additional $50 million in debt to build up the campus infrastructure, said Dan Morissette, UT's senior vice president for finance and administration.