USA Group Fund to Get $770-Million

The small grant-making arm of USA Group, a non-profit provider of student loans based in Indianapolis, is set to receive $770-million in cash and stock from Sallie Mae, the country’s largest student-loan financer. The transaction results from Sallie Mae’s purchase of USA Group.

The cash infusion to USA Group Foundation, which was created in 1997, would make it one of the country’s 100 largest grant makers.

The move is the latest in a series of acquisitions and tax-status conversions in the student-loan industry — triggered by a 1996 change in federal law — that have resulted in the creation of major new philanthropies. For example, the Nellie Mae Foundation, in Boston, was formed in 1998 and has assets of $395-million.

The USA Group Foundation plans to use its new assets to award roughly $40-million a year in grants — up from $2.1-million last year — to help make higher education more accessible to students from low-income families.

For more information, contact the foundation at P.O. Box 7039, Indianapolis 46207-7039; (317) 951-5114.