An agreement by the A. Eugene Brockman Charitable Trust to endow 160 full scholarships at Centre College, in Danville, Ky., came together this summer after less than two months of negotiations. On Monday officials at Centre announced that the deal had come undone even more quickly because of a “significant capital market event” that left the donor unable to make its planned $250-million stock gift to the college.
The gift, which was to have established the Brockman Scholars Program in Leadership and Entrepreneurship, would have been the largest ever to a liberal-arts institution. In announcing the deal on July 30, Centre described it as a $250-million stock donation, but the transaction turned out to be much more complicated than that.
“This was part of a major reorganization and recapitalization of … considerable size and complexity,” said Richard W. Trollinger, vice president for college relations at Centre. “It was a multibillion-dollar deal.”
He described his institution and the Brockman Trust as “minor players in a much bigger corporate reorganization recap that for whatever reason—reasons that are unknown to us—did not come to fruition.” ...
Mr. Trollinger said the college was forced to announce the $250-million gift from the trust in July after news about the corporate reorganization and recapitalization hit the financial news wires. Faculty members at the college started getting curious calls from old grad-school colleagues who were working in finance.
“The story was that Centre was acquiring $250-million worth of the stock” of Universal Computer Systems Holding Inc., Mr. Trollinger said. “People were wondering how an institution with a $230-million endowment could be doing that.”
Neither the college nor the Brockman trustee who negotiated the deal thought that it could fall through, Mr. Trollinger said. “But there clearly was a level of risk involved that we weren’t aware of and we couldn’t have anticipated,” he said.
via chronicle.comAlumni got an embarrassed email last night. Count me amongst the embarrassed alumni.