Frenship Independent School District

Background

Baird served as Sole Managing Underwriter for Frenship Independent School District’s (the District) $7,575,000 Unlimited Tax Refunding Bonds, Series 2026A. The bonds carried ratings of Aa3 from Moody’s and were enhanced to Aaa through the Texas Permanent School Fund (PSF) guarantee. Proceeds were used to refund outstanding debt for debt service savings and to pay costs of issuance. The financing was structured with a short maturity schedule extending nine years and was issued without an optional call.

Opportunity

Because of the $7.6 million par amount and the non-callable structure, the transaction was expected to generate a thinner order book than a typical Texas school district issuance. The underwriting team’s challenge was to efficiently distribute the bonds while maintaining strong investor demand and achieving favorable pricing for the District.

Implementation

Baird brought the bonds to market and actively managed the order book throughout the pricing process. Given the short maturity schedule, the deal featured relatively strong block sizes across maturities. Baird monitored demand across the maturity schedule and adjusted pricing where appropriate to align with investor interest.

Results & Impact

The bonds were brought to market with solid investor engagement despite the smaller issue size. The order book ultimately reached approximately 1–2x subscription through the 2033 maturity. Larger $1 million-plus blocks in the 2034 and 2035 maturities generated increased interest, allowing pricing to be lowered by two basis points in those maturities. A small $230,000 balance in the 2027 maturity was quickly absorbed shortly after the order period.

All bonds were successfully placed, achieving efficient distribution and pricing improvements in key maturities despite the modest deal size and short structure. The refunding generated debt service savings for the District while demonstrating strong investor demand for the credit.