Big 12 in Advanced Talks for Deal with RedBird-Backed Fund
Meanwhile, the Big 12 Conference is in advanced talks with an investment firm backed by RedBird Capital and Weatherford Capital for a $500 million cash injection.
According to a person familiar with the matter, the deal, via Collegiate Athletic Solutions, known as CAS, follows failed talks earlier in the year for a direct investment into the Big 12.
Consequently, the partnership would offer the 16 member universities a line of credit of roughly $30 million each and is close to being finalized, the person added.
Financial Pressures Mounting for Colleges
In addition, many colleges are facing mounting financial pressures from rising athlete pay and escalating coaching salaries, driving the demand for upfront capital.
Therefore, conferences and schools are increasingly looking for funds to be repaid over several years, often secured against future revenue from media rights.
Moreover, the Big 12 confirmed the negotiations in a statement to Yahoo! Sports, which first reported details of the deal.
Big 12’s Financial Gap with Rivals
However, the search for new capital is considered crucial for the Big 12 to close the financial gap with rivals such as the SEC and Big Ten, which distribute significantly more cash to member institutions.
Consequently, the Big 12 has a $2.3 billion media rights deal with ESPN and Fox, running through the 2030-31 season.
Meanwhile, the six-year contract stabilized the conference post-Texas and Oklahoma’s exit.
Colleges Setting Up Separate Commercial Vehicles
Furthermore, numerous colleges, including Kentucky, Clemson, and Michigan State, are setting up separate commercial vehicles in order to receive outside investment without giving up ownership of their athletics programs.
Therefore, the model follows similar deals among European football leagues, where private equity firms have invested in a vehicle housing media and commercial rights.
In addition, the Big 12 Commissioner Brett Yormark stated at SBJ’s Intercollegiate Athletics Forum on Tuesday that the league is not planning to sell a stake in the conference.
However, the league would consider a partnership focused on business growth.
RedBird Capital and Weatherford Capital
Moreover, RedBird Capital, led by Gerry Cardinale, manages $12 billion and counts AC Milan, Boston Red Sox, and Liverpool FC owner Fenway Sports Group, LeBron James’ SpringHill Co., and regional broadcaster Yes Network among its investments.
Consequently, Weatherford Capital is co-founded by Drew Weatherford, a former college football player for Florida State University.
Therefore, the partnership between the Big 12 and RedBird-backed fund is a significant development in the world of college sports.
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