AUSTIN, Texas—The University of Texas at Austin announced today a gift of $6 million from the named partners of the Dallas investment firm of Hicks, Muse, Tate & Furst Incorporated.
The gift, to the McCombs School of Business at UT Austin, will create one of the country’s first academic centers for the study of private equity investing, the Hicks, Muse, Tate & Furst Center for Private Equity Finance.
Private equity finance, while less well known to the public than stocks and other conventional investment vehicles, has been one of the prime movers of the entrepreneurial economy over the last ten years. By restructuring targeted industries, private equity firms have been a catalyst for fundamental changes in the global economy. Since 1991, private equity firms have increased capital raised for investment almost eleven-fold, on the strength of double-digit returns throughout the decade. Large corporations have now entered this booming sector, both as strategic and financial investors, which places an even greater premium on training experts in the field.
Since its formation in 1989, Hicks, Muse, Tate & Furst Incorporated has completed or currently has pending more than 330 acquisitions with a total capital value of approximately $44 billion. Headquartered in Dallas, the firm also has offices in New York, London and Buenos Aires.
The Hicks, Muse, Tate & Furst Center will support curriculum development for a private equity specialization within the McCombs MBA program. An academic and research unit of the Department of Finance, the Center will also foster research by finance faculty and graduate students on issues related to private equity finance, capital markets, corporate finance, investment and real estate.
The gift creating the Center is unusual in that it will be invested in a fund managed by the firm for up to 15 years, the overall value of which is expected to greatly exceed $6 million during the life of the investment. In an additional move, Hicks, Muse, Tate & Furst Incorporated will guarantee UT Austin at least $300,000 a year in distributions during the life of the investment.
“We are very grateful for this extraordinary gift,” said UT Austin President Larry R. Faulkner. “It allows us to focus substantial resources on an area of keen interest to business students and scholars. Private equity finance is a field of growing importance to the Texas and national economies.”
This gift is being made jointly by Thomas O. Hicks, John R. Muse, Charles W. Tate and John D. Furst, the four principals of the firm. Hicks, Tate, and Furst are graduates of UT Austin. Their company, one of the largest private equity investment firms in the world, specializes in strategic investments, leveraged acquisitions and recapitalizations.
“All four of us consider this gift to be an investment in the future,” said Charles Tate of Hicks, Muse. “The University of Texas and the McCombs School are important partners in preparing young men and women to assume leadership positions in tomorrow’s economy. And it is our belief that private equity financing will be an integral part of that economy.”
“This is a bold but business-like gift from one of the most successful private equity firms in the world,” says dean of the McCombs School, Robert G. May. “And fortunately for us, three principals of the firm — Tom Hicks, Charles Tate and Jack Furst — are among our most dedicated, passionate and loyal alumni. These men understand business and they value education — and the entire state of Texas benefits from their vision.”
May expects that the gift will help the finance program at the McCombs School reach new heights. Only two other top 20 business schools, Stanford and the University of Chicago, currently have dedicated courses in private equity finance, a branch of venture capital that involves some of the highest stakes in the entrepreneurial economy and promises to be an area of major, global economic activity over the next quarter century.
The McCombs School of Business is consistently considered one of the top business programs in the country. Business Weekranks the MBA program #17. U.S. News & World Reportranks the MBA #16 and the undergraduate program #5. The school is especially noted for innovative programs in technology, entrepreneurship and globalization. Visit www.mccombs.utexas.edu for more information.
For additional information, contact Jim Kunetka, Resource Development Office (512-475-9641), jkunetka@mail.utexas.edu; Kim Head, McCombs School of Business (232-7510), kim.head@bus.utexas.edu; or visit the McCombs School Web site www.mccombs.utexas.edu
