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Case Study: New England Liberal Arts College
Management of Debtholder/Investor
Relations, Wind-down & Liquidation Management
Company: 200 year-old four year liberal arts college with enrollment of approximately 550 full time
students per year and $8 million in annual tuition billings.
Situation / Tasks Performed: The college was experiencing difficulty attracting students. They attempted
to combat with excess course offerings and up to 60% of tuition was subsidized with financial aid. In 1998,
$20 million in bond debt was added for the purpose of renovating and constructing new student housing. Operating
losses resulted in a decrease in the school's endowment from $18 million to $8 million. TRG was hired to assist
the Board of Trustees in determining whether the school could remain viable on its own. TRG determined that the
school could not survive on its own and developed a plan that would allow for the school to remain open long enough
to graduate the current senior class while exploring merger, acquisition and sale possibilities and to negotiate with
the bondholders to allow the implementation of this plan.
Results: Negotiations were successfully completed with the bondholders that allowed for the school to complete the Spring
Semester after which the college ceased operations. Seniors graduated and underclassmen were placed in other institutions.
After an exhaustive search for a suitable educational merger or acquisition candidate, no continued educational use could be
found and the college was listed with a commercial real estate broker who is currently marketing the property for sale.
Nature of Assignment:
Primary: Management of Debtholder/Investor
Relations
Secondary: Wind-down & Liquidation Management
Industry: Education
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