Yesterday, the university took possession of the popular student watering hole, and confirmed it paid $1.75 million excluding GST for the property.
The tavern was put on the market earlier this year, and had a valuation of $1.025 million.
Owner Pete Innes-Jones closed the doors of the tavern at midnight last Friday - a day earlier than scheduled - following concerns the All Blacks v Wales test would draw a big crowd to the area.
Castle St has been the scene of mass disorder in recent years, and Dunedin authorities had put a temporary liquor ban in place.
The university denied rumours it paid more to secure the early closure of the tavern.
Chief operating officer John Patrick said the university bought the tavern because it was for sale and it "has a use for the property".
The tavern was likely to be turned into a student study centre, which would help alleviate pressure on the central library, he said.
However no final decision had been made, he said.
