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Cambridge Univ plans to raise 300 mn pounds through debt

Cambridge Univ plans to raise 300 mn pounds through debt
PTI
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First Published: Wed, Jan 06 2010. 05 17 PM IST
Updated: Wed, Jan 06 2010. 05 17 PM IST
New Delhi: Looking to capitalise on the current market conditions, Cambridge University is planning to raise up to £300 million this year through issue of long-term debt for the first time in its 800-year history.
A top official of the prestigious British University said that the long-term funds would be used for development activities, since cash flows from its regular operations would be ‘insufficient’ to meet the requirements.
“The projects have become clearer in cost and timing and the University is now considering raising significant sums of long-term (30-50 year) funds via the fixed interest markets, taking advantage of current market conditions,” University of Cambridge’s director of finance Andrew Reid said.
In an emailed statement, Reid noted that bank financing, private placement or public bond issue are possible routes.
“An indicative range is £200-300 million. The University anticipates finalising, and perhaps implementing, its approach in the course of 2010,” he said.
Reid pointed out that the University has not borrowed material sums at any time in its history, even though a number of the Cambridge Colleges have raised long-dated loans.
The University is planning to embark on two major capital projects, including housing, to address the recruitment and retention problems of staff.
According to Reid, cash flows from its regular operations would be insufficient for such major expenditure and external financing would be required.
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First Published: Wed, Jan 06 2010. 05 17 PM IST