Top municipal bond firm Siebert Cisneros Shank led refinancing with 99.7 percent of all sales, outperformed Moody’s predictions on savings
One of the nation’s top municipal finance firms, Siebert Cisneros Shank, & Co., LLC (SCSCO) led the refinancing of water and wastewater bonds in Atlanta that will save the city nearly $43 million over the life of the bonds, helping to hold down rates for decades for the system’s 1.8 million users.
The firm, one of the nation’s most prominent woman- and minority-led investment banks, generated 99.7 percent of all sales on the transaction, with the bonds bringing in $643 million of orders. Despite a recent negative tone in the bond market, the refinancing produces total debt service savings of $42.8 million or $27.5 million when present valued at the City’s borrowing cost, about 11.5 percent in savings, nearly twice the 6.5 percent rate Moody’s Investors Service predicted in March. The deal closed May 4, 2017.
Moody’s upgraded the bond ratings to Aa2 just prior to the transaction, citing sound coverage and ample liquidity despite significant capital investment. For the system’s 1.8 million users, the refinancing will mean nearly $2 million of funds raised from water and sewer rates annually that were set aside to pay debt service, can now be used for to improvements to the City’s water and wastewater infrastructure. The reduction in debt service allows the City to project lower system rate increases over the life of the bonds, which mature in 2039.
“This is one of the largest water and wastewater treatment systems in the country and we were able to price and execute a transaction that significantly saves taxpayers and the ratepayers of metro Atlanta,” said Sean Werdlow, Senior Managing Director and Chief Operating Officer of SCSCO. “We are extremely proud to partner with this great city to deliver value for its citizens, to investors and to create the tools needed to improve services while lowering long-term costs.”
It is the third major senior managed transaction the firm has led in Atlanta in recent years, including the expansion of Hartsfield-Jackson Atlanta International Airport, the busiest in the country. SCSO has assisted the City in achieving nearly $125 million in present value savings for the Hartsfield-Jackson Atlanta International Airport.
SCSCO has transacted more than $1.4 trillion of municipal bonds and $1.1 trillion of corporate bond and equity transactions since its founding in 1996. It earned the distinction in 2010 of becoming the first minority-owned firm to rank among the top 10 senior managers of municipal bonds, as ranked by Thomson Reuters. The firm ranked as the No. 1 minority- and woman-owned municipal finance firm for 18 consecutive years.
It has dual headquarters in New York and Oakland, CA, as well as 18 offices nationwide including Atlanta, Boston, Chicago, Dallas, Detroit, Ft. Lauderdale, Houston, Los Angeles, Miami, Philadelphia, Sacramento, San Antonio, Seattle, St. Louis and Washington, DC.