Rutgers University’s governing boards approved a historic merger with the University of Medicine and Dentistry of New Jersey today, consenting to bring together two of the state’s largest institutions and giving the state university the medical schools it has wanted for years.
But the union won’t come cheaply, especially for Rutgers which is assuming half a billion dollars in expenses and debt.
Rutgers will spend between $45 million and $75 million in the next year or two on the UMDNJ takeover, campus officials said. That includes millions spent on consultants, attorneys and financial experts needed to bring the two complex schools together.
Rutgers will also take on $456 million of UMDNJ’s debt, according to a financial analysis made public shortly before today’s vote. The added debt means Rutgers’ Aa2 credit rating will likely be lowered, making it more expensive for the newly merged university to borrow money.