Want to buy a stake in the Pac-12 Conference? It’s exploring taking on private equity partners (Oregon Live)

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https://www.oregonlive.com//sports/oregonian/john_canzano/2018/12/want-to-buy-a-stake-in-the-pac-12-conference-its-exploring-taking-on-private-equity-partners.html

>>Pac-12 Conference leadership pitched university presidents and chancellors a strategic plan aimed at bailing out the struggling conference and helping it keep pace with its Power Five Conference peers.
The “Pac-12 NewCo” plan was introduced to the conference presidents and chancellors at their mid-November meeting and was subsequently discussed in a conference call in December, per sources. Private investors would own 10 percent equity in the newly formed entity in exchange for a $500 million investment.<<


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uconnphil2016

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This seems like an absolutely awful idea lol. We're going to essentially make student athletes and their value a traded commodity? I mean, I guess that's already the case, but giving private entities a 10% stake in the conference seems to be a terrible idea, as their interests will surely have no relation to player well being. Squeezing out extra $ at the expense of the student athletes.
 
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I could think of 1000s of better ways to spend $500 million then to own 10% of a failing entity.
 
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Just curious how you get paid on your 500 million.

Might as well ask for 500million dollar donation.
 

zls44

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The Pac-12 is so out of its own depth its incredible. A master class in incompetent leadership.

I - correctly - get on Aresco for stuff, but he's 100x better than Scott is.
 

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Watch Tim Ferrieta take 10%.

@uconnphil2016, I dont see much difference between ESPN or Fox owning 10% of the PAC 12 network and another investment arm so to speak. Both have the same endgame, return on investment.
 

whaler11

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https://www.oregonlive.com//sports/oregonian/john_canzano/2018/12/want-to-buy-a-stake-in-the-pac-12-conference-its-exploring-taking-on-private-equity-partners.html

>>Pac-12 Conference leadership pitched university presidents and chancellors a strategic plan aimed at bailing out the struggling conference and helping it keep pace with its Power Five Conference peers.
The “Pac-12 NewCo” plan was introduced to the conference presidents and chancellors at their mid-November meeting and was subsequently discussed in a conference call in December, per sources. Private investors would own 10 percent equity in the newly formed entity in exchange for a $500 million investment.<<


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I’ve been part of some pretty big transactions.

I’ve seen people invent value stories to fit their required narrative.

I’ve never come across anyone delusional enough to pretend the Pac 12 rights are worth 5 billion dollars.

If they took that chart to shark tank - that one guy would offer $80k for 51% to superimpose FUBU on the broadcasts.
 

whaler11

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I seriously was wondering if i lost my mind because this was old news.

Then I got to this gem.

The Pac-12 pursued a similar strategy several years ago, hiring a consultant (Lazard Asset Management) to explore options for the Pac-12 Networks. The conference ultimately decided to retain full ownership, rather than selling equity.

So... you tried this before and there was zero interest. Now, when the value is clearly lower than the last time you tried it’s going to change?

Pac-12 network will be off the air in 3 years. It’s a completely worthless property.
 

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Pac-12 network will be off the air in 3 years. It’s a completely worthless property.
The PAC-12 is the canary in the coal mine... And nothing will change for them because demographics are unfavorable...who moving into CA is a big college sports fan? In PAC 12 the very diverse youth environment is not into college sports and that wont be changing anytime soon.

But the PAC 12 wont die either, it just wont have the $$ to be lavish like the B1G/SEC and gulp, ACC.
 
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Pac-12 equity sale: Update coming this week in Las Vegas

>>But could there be a fourth option, a partner so familiar with the Pac-12 and so close to home that it is home:

What if the universities were the partner?

What if the 12 schools formed a consortium which, in turn, purchased the 10 percent stake in the Pac-12 media rights?

What’s a few hundred million when your combined endowment is more than $15 billion (and that’s without Stanford’s $25 billion).<<

>>Let’s say each school invested $25 million into the consortium — that’s just 2.5 percent of the smallest endowments — in exchange for a 10 percent stake.

That’s $300 million, which would sent directly to the athletic departments.

Let’s estimate the ROI in the media rights holding company over the course of 10 years is set at a fixed rate of six percent.

(Why six? That’s a tick above the escalator in the Pac-12’s current Tier 1 deal with ESPN and Fox, but it’s not overly optimistic.)

By the end of the decade, the $300 million initial investment would be worth $550 million, and each school’s haul would be $46 million.<<
 

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Pac-12 equity sale: Update coming this week in Las Vegas

>>But could there be a fourth option, a partner so familiar with the Pac-12 and so close to home that it is home:

What if the universities were the partner?

What if the 12 schools formed a consortium which, in turn, purchased the 10 percent stake in the Pac-12 media rights?

What’s a few hundred million when your combined endowment is more than $15 billion (and that’s without Stanford’s $25 billion).<<

>>Let’s say each school invested $25 million into the consortium — that’s just 2.5 percent of the smallest endowments — in exchange for a 10 percent stake.

That’s $300 million, which would sent directly to the athletic departments.

Let’s estimate the ROI in the media rights holding company over the course of 10 years is set at a fixed rate of six percent.

(Why six? That’s a tick above the escalator in the Pac-12’s current Tier 1 deal with ESPN and Fox, but it’s not overly optimistic.)

By the end of the decade, the $300 million initial investment would be worth $550 million, and each school’s haul would be $46 million.<<
Hilarious...but the endowments know its a lousy investment....so - um - pass!
 

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