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$210,000 in 38 Studios bonds traded [The Providence Journal, R.I.]
[November 06, 2014]

$210,000 in 38 Studios bonds traded [The Providence Journal, R.I.]


(Providence Journal (RI) Via Acquire Media NewsEdge) Nov. 06--PROVIDENCE, R.I. -- As Democrat Gina Raimondo sweated out the last hours of voting Tuesday in Rhode Island's closely contested race for governor, someone decided it was a good time to make a trade on 38 Studios bonds.



The 2010 decision by the Rhode Island Economic Development Corporation to sell $75 million in bonds to back the video-game company's move to Providence has become a smoldering political issue. The company's closure in 2012 intensified the public acrimony about what many Rhode Islanders decried as an ill-considered deal made at a time when companies around the state struggled to recover from a deep recession.

As the state's general treasurer, Raimondo has consistently backed paying off the bonds, a stance that generated a fair amount of flak from Rhode Islanders and an all-out assault from Allan Fung, her Republican opponent in the 2014 campaign.


Raimondo was able to withstand an advertising onslaught criticizing her stance to win the governor's seat, though she did not win a majority of votes cast.

As Raimondo and other Rhode Islanders focused on exit polls Tuesday, someone executed a trade of $210,000 in 38 Studios bonds at 4:54 p.m., according to the Municipal Securities Rulemaking Board, which tracks financial transactions by American government entities. The board does not publicly disclose parties to such transactions.

The 38 Studios bonds originally were sold in three portions or tranches as they are known in the bond business. The tranches carry different interest rates and mature in different years; 2015, 2016 and 2020.

Bond trading can take place on any day when financial markets are open. Trades of 38 Studios bonds have been few since they were first issued.

As exit polling Tuesday may have shown Raimondo would edge out Fung, someone decided it was the right time to swap these financial instruments because state legislators are in all likelihood going to pay off the 2015 bonds.

The bonds sold Tuesday are a small fraction of the 2015 tranche of about $23.7 million, which have a 6-percent interest rate.

Board records show that other 38 Studios bond trades occurred in the weeks following Raimondo's victory in the September primary.

___ (c)2014 The Providence Journal (Providence, R.I.) Visit The Providence Journal (Providence, R.I.) at www.projo.com Distributed by MCT Information Services

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