Atlanta selects new airport bond underwriters

After the controversy that erupted last year over the selection of airport bond underwriters, the city of Atlanta has decided to use all 23 of the firms that submitted bids under a new selection process for the issuance of $1.6 billion of bonds.

The city also decided to split the bonds into three separate issues -- $650 million to be issued in the next several months to complete construction of the international terminal, as well as issues of $481 million and $500 million to refinance bonds later on. The city said that's a return to a previous plan to use separate transactions.

Mayor Kasim Reed has said the city wanted to ensure the new selection process would withstand a legal challenge. Last year, the city's then-chief financial officer asked for an investigation into a letter regarding the selection of underwriters.

The investigation found there was insufficient evidence to prove city officials had any inappropriate dealings with the two minority bond firms in question. It did confirm that a council member advocated for minority investment banking firm Grigsby & Associates' role in the bond deal.

In January, shortly after Reed took office, the city issued a request for proposals for airport bond underwriters, saying it wanted to "ensure transparency and eliminate any hint of controversy."

The underwriter selections for the new money for the international terminal include J.P. Morgan as bookrunner, Jackson Securities as co-senior manager, and co-managers Bank of America/Merrill Lynch, Grigsby & Associates and two other firms. Bank of America/Merrill Lynch had been selected as bookrunner under the process last year. Rice Financial Products, a minority firm selected under the original process, is included in one of the refinancing deals.