On Thursday, Aug. 15, 2013, Texas A&M University paid Texas Wesleyan University $73.2 million for the acquisition of the former Texas Wesleyan School of Law.
Texas A&M University System Chancellor John Sharp described the transition to Texas A&M ownership going very well.
“All employees have been moved over, our IT systems are largely transferred, and rebranding has begun,” said Sharp. “We are also discussing ways to further enhance our curriculum and related programs to provide the best legal education possible.”
According to Texas Wesleyan President Frederick Slabach, Wesleyan has entered into a five-year property lease purchase with Texas A&M. The lease terms are $1.4 million the first year, then four payments of $1.7 million for the remaining 4 years, and at the end of the five-year lease Texas A&M will pay $11 million to acquire the property.
Texas A&M acquired the law school for $54 million. The A&M system paid Texas Wesleyan $30 million at closing and will make four annual payments of $6 million each.
The lease payments – $1.4 million and $1.7 million – are revenue to the operating budget for the TWU. The first portion of $30 million was used to pay off more than half of the long-term structured debt for the university, said Slabach.
Slabach explained that parts of the endowment will be used to help students with student-faculty research, deferred maintenance and the vast majority of the existing endowment will be spent on scholarships. Slabach also said The Board of Trustees will have to make the determination about how the income from the endowment will be spent – a process that will take months and will begin in November.
“I think the transaction with Texas A&M involving the Law School will have a very positive overall affect on Texas Wesleyan University because of the resources that it brings to bear for us here,” said Slabach. “I believe Texas Wesleyan will be perceived in the community just as favorably if not more favorably after the transaction than before.”
Beverely Toal, vice chairman of the Board, felt the Texas Wesleyan family and faculty will benefit. Toal believes Texas Wesleyan will benefit for the long run, and the effect will allocate resources over the years, not just for the short run. Toal also felt the funds received through the transaction will have a lasting effect.
“I’m very excited about it,” said Toal. “I think the transaction was a win-win-win transaction for our university. I think it was a win for Texas Wesleyan and that the structure of the transaction was a winning one for Texas A&M. I also think the City of Fort Worth will benefit.”