Big 12 Seriously Discussing Taking $1 Billion From Private Equity
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- Опубліковано 12 чер 2024
- Brett Yormark and the Big 12 are in serious private equity talks. They're also close to selling conference naming rights to Allstate. A TON to unpack here.
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I can’t believe anyone thinks taking PE money is a good idea. For every $ the Big 12 takes from PE, it’ll be paying them at least $2!
It’s like putting a billion on a credit card. PE’s will demand an ROI on their investment. This isn’t revenue it’s an equity loan. How the hell will they turn a loan into a billion + $ of revenue. As a KU fan this scares the heck out of me.
Kurtz clearly hasn’t worked with PE firms.
What’s your solution to closing the monetary and talent gap?
@@moffprof02 no idea. But getting PE money won’t solve the problem. If anything it will make it worse.
I appreciate the updates John. My anxiety is up processing all of this. One day at a time. Enjoy your upcoming weekend!
CVC and my parent company purchased the company i worked for 6 years ago because the parent couldnt go at it alone. After 6 years, our parent company was able to buy the CVC stake and now we are a single entity.
It was all behind the scenes as far as the employees were concerned and we have benefited
A hard choice because the B12 has to show significant growth.
But this is better than just taking it lying down.
This is a chance to be a 2nd tier conference withing striking distance vs a 2nd tier conference with no chance at anything.
taking money from Pvt Equity who care nothing for college sports or the people living, working, or who graduated from those institutions is beyond risky they just care about making money
Big 12 is going to be a Chrysler.....
This puts at least one PE Exec at the table at every meeting and every decision being made. 1B will not go as far as they think it will. You cannot compete with the B1G or the SEC money gap/talent gap. An elite player may still take .50 on the dollar to play at Georgia over the full dollar at any Big 12 team. Alabama got elite athletes and Saban refused to pay. Big 12 is guns for hire and the SEC still will be we will give you some money. Good luck is cancelling non revenue female sports program with Title IX. It will not happen.
The end is near😂
Don’t do this Big XII. Take some time and grow deeper roots with your new schools. Still plenty of talent in the league and passionate fans! Don’t sell out your future to try and keep up with the Big 2. You won’t catch them anyway.
The Viagra 12- keeping it up for a little longer
Coming up with 22 million dollars? It's gonna take PE, cutting sports, AND cutting budgets. The problem with most athletic departments, along with most universities, is that they don't want to CUT BUDGETS. They want to operate in a vacuum. Add to that Title 9 issues plus state supported universities versus private universities, what it boils down to is what is the mission of a university? Is it to educate the masses or support semi-professional sports? Evidently, it's about supporting semi-professional sports. This is a seminal time in history when this will be defined. Everyone chasing the money makes me want to throw up.
How would you feel as an Allstate employee and hearing “no raises this year because of inflation” then hear they are about to dump MILLIONS into renaming a college football conference 😂
I do worry about this. I remember when Larry Scott first made that big deal with ESPN. It was the largest in college football at that time. I knew when the sec and bug 10 deals came around they would surpass the Pac, and not just by a little. That was back in 2010. This just leads the way for sec and B10 to go after more money.
That 1 billion will only cover 62 million per school for 1 year. What about year two? Three? At selling 20 percent ownership each time, PE will own the whole conference at year 5.
Of course DR Pepper needs to be brought up with this.
If private equity got involved, i wonder if this would affect the ability of teams to leave the conference. At that point you're not just buying out your media rights deal but now you're messing with equity.
PE makes sense if you have an immediate need for cash and are willing to pay 1.5x to 2x in the long term. What is the immediate need? Also, PE will want collateral. What is the league pledging in the event of a default? Individual school endowments? Yormark may as well talk to his in-laws and make a deal with the mob.
The Lotrimin AF Big 12, “Let us calm your itch!
The Bud Light 12 Pack
Nice RING to it! 😂😂😂😂
You can hire Kid Rock to blast it all to hell 3 years from now.
The idea is to stay together as a conference and fight thru this situation. This a reality and the conference has to do whatever is needed to survive and stay alive as a conference. The trick is to do it the right wait and avoid problems.
How about. Truck stop conference presented by QuikTrip
Or Love's. Or the Ute fan, Flying J! 😂
What do you even do with a billion dollars? If the Big12 office doesn’t take a huge cut, it’s 62.5M per school. What will happen with that? The company giving you 1B is buying 20% of the conference revenue. So the 32M you get per year per school, drops to 25.6M per year. 6.4 million less per year. If they could invest the 62.5 they need to return more than 10% per year. Hard to do. And you need to keep in mind Bret Yormark doesn’t work for free, the Big12 office is going to take some amount of that Billion. So in reality, somebody will own 20% and take 20%. Then you need to add new ACC members. How much do they get per year? Does the private equity owner need to pay Pitt some amount when they join? Or is Pitt expected to take the new lower payout of 25.6? This is all very sketchy and sounds like it’s great for the Big12 office and maybe the university presidents but long term, very very bad. Like selling your soul to the devil. And when Utah or KU wants to leave for the big10, do they have to pay back the 20% valuation at that time? If exiting team don’t have to pay back, then yeah, they want to sign up, it’s free money. I like the idea on the surface, but long term it deters ACC schools from entering. We need to grow revenue and this is just a quick hit that in 10 years will be a real anchor on the league.
The Coke a Cola 20 pack or Budlight 30 pack conference? LOL
The guy is nuts!
Naming rights I understand,but private equity doesn't sound good. That money has to be repaid so if the B12's value doesn't go up it would hurt the schools down the road.
Why wouldn’t the value of B12 go up?
@@moffprof02 Well let's see;1- they're not the B1G/SEC, 2-media companies are maxed out now (that is why ESPN has been laying off talent), 3- Private equity companies will be buying 15-20% of the conference, will the media deals cover that?
If not the schools will be worse off than before. It is a gamble, no-one knows what will happen in the future. It is speculation. No-one thought ESPN & Fox would be maxed out now, but they kind of are. Fewer Kids are playing football now, viewership has flattened out.
College football will be carved out into various haves/have not pieces and I and millions of others will feel alienated and refuse to watch this team or that conference.
The Buc-cee’s 16
Capital One Big 12, We know what’s in your wallet. A BILLION DOLLARS!
Old El Paso Tacos 12. Headquarters could move to New York City. New York City!?!?!?!?
If the private equity thing goes wrong the the conference may end up far worse than they are now. It is a big gamble, I would vote no.
If you don’t want private equity, then ACCEPT being a second class conference, Big 12 will not be able to compete with B1G and SEC.
The B12 will never catch up. That's what people need to understand. This is so shortsighted.
The public universities will get taxpayer dollars to bail them out if things go south. The private institutions on the other hand don’t have such a bail out system in place.
@@jansonroberts2616 Unless the private institution is "too big to fail" ofcourse
@@paulmezzetta6905 still better than private equity.
My dude….everyone, everywhere is just making short sighted selfish choices….from universities to meat packers to tech companies to Wall Street to supreme court….this is our world now…
The cost to change the Big 12 branding might not make it worth it.
Nectar of the Gods Dr Pepper 12
Will the schools agree to a long term contract, and the uneven revenue for the conference. Not all schools will get the same amount of money
Would that take us full circle back to when UT was beating down all the other “smaller” schools?
“College” Sports is truly finished. It had a good run though.
The 3M is a lot. The SEC and B10 will not change their name. This is a way to cut the gap. Colorado Buffalo Wildwings. Who the hell guves a shit, you need the money to compete. I shit goes south, then at least the B12 schools can say they went down fighting
I'm over cfb. Idc anymore. Have a good one
Additionally the revenue math put forth is a complete and total joke in the PE and Investment Banking world
Jesus…
It’s much, much, much higher.
SMH
The Good Hands Conference does have a ring to it. Not the Allstate XII.
It seems like the transfer portal is a bunch of BS. If the players are employees then they should be traded to the other schools for money or other players. Sort of like the pro’s. The university’s should sign players with contracts like the pros that lock in the players to the universities. If the players cannot leave unless they quit sport or are traded, or their contract has run out.
Remember when fans of the B12 laughed at the idea of the PAC12 selling a piece of itself off? Pepperidge Farms remembers... The Big 12 is proving it is definitely the kiddie table conference.
@tyandbrand
You need an education to respond here.
Go get your shinebox.
I actually like the Mayhem 12 for Allstate sponsor
And we wonder why car insurance is so high????
Maybe the Big12 crybabies, like John, should stop complaining about the P2 being "greedy" because they have more fans that support their revenue generating sports and tell their schools to become "greedy" just like them.
I don't like the change to All State 12
Tricky decision, PE or not. Is the risk worth it, I think it is.The $ to get to next media deal, to pay & keep athletes, facilities, enrollment will drop if not taken.Relagation sucks, ask WSU &OSU.
DO IT !!!
Utah would be the holdout, should have left them behind.
Schools need to vote Brett the support to negotiate the very best deals possible!
With extra money we may have to cut back on how many ACC schools we can absorb. Now NC, NCST, Miami, Louisville, Duke & Virginia would be realistic goals to the Big 12!
So, whether 12 or 16 teams vote, vote YES & get on with it!
Yep, be the first to sell your soul to the company store.
Or we could just drop the G5s and pick up the valuable brands that are left in the ACC.... Yeah, I didn't think so.
AT&T, Jerry Joes will help! The Big 12 powered by Fox and AT&T
The Allstate Conference. Corny? Or Yormark's way to sell the Conference as a nationwide entity. I vote for corny.
🤣🤣
You can’t wring your hands at falling behind in the money game, and be against private equity investment.
Maybe Elon will make it the X Conference
I don't think the Big 12 have a choice play there's money out there you got to take the risk because the conference it's already on a path of non-relevant
Y'all will lose those type of players anyway. The BIG12 is selling 20% of your conference forever or until the PE allows you to buy it back. That's 62 million dollars per school and the schools will only be making 80% of the revenue moving forward.
Go BIG or go home, Big12
Exactly. If we're gonna go down anyway, might as well go down fighting. Do not go gentle into that good night - rage, rage against the dying of the light!
Public universities should not go further in debt to try to compete to get out of debt. It is time to fold and accept second class status. Leave the BIG 12 and SEC behind and have are own national championship with whatever conferences want to join.
The SEC is not forcing anyone to do anything. The SEC simply asked the networks, etc to pay the SEC what the SEC is worth. Its capitalism and a market economy. Big12 apologists need to quit blaming SEC greed for the on-the-field shortcomings. OU and Texas left the BIg12 because the Big12 was falling behind in every way a conference can fall behind. The SEC did not recruit OU/UTX.
Competitively and entertainment value the big 12 is as high as ever. Sec has 2-3 good teams every year and bunch of overhyped mid at best teams that ride bama Georgia. The sec was greedy and only reason they started success was espn helping them all the way along
Aways 2 sides of every story. Can't blame OU & Texas leaving. Big 12 has always been reactive. ESPN & SEC are snakes in the grass, the Big 12 was supposed to die, but we are a Phoenix. Yormark not new to this PE, so here we are. We will die a slow death unless we act on this, better on the future is what's at stake.
@jonathanwrehe8015 ESPN doesn't build the football programs or play the games. They negotiate based on the eye balls watching SEC games. Same with the other conferences. That's very abbreviated, but it's how sports media works.
@@michaelbee2165 they helped them starting in the bcs era getting them in no matter what and did that this year with bama cause they just could’ve have a playoff without the sec. The media ranking 8-9 sec teams most weeks and giving them unwarranted hype hurts other leagues perceptions when they should have their teams ranked and get more attention. ESPN started this and that’s why they want the sec to kill off the big 12 and acc
@@jonathanwrehe8015 Fire your coach then. He voted for those SEC schools in the coaches ranking poll the same as the media voted in their ranking poll. The CFP committee doesn’t go strictly off those two polls but they’ve said that they do review those polls in their consideration.
John it is obvious you need to brush up on the workings of the greatest enterprise system in the world. . . the American Free Enterprise System. There is nothing down and dirty with business within the capitalism system. Bring on some free enterprise private equity experts to educate not only your audience but yourself.
I have you thumbs down cuz of your live chat folks not having a damn clue about the subject and characterizing PE as the Devil Incarnate.
It is
@@pwho405 which sport do you your school to cut? Your revue drops 22% beginning in 2025 as a requirement to play D1 Football. Less than a handful of programs are profitable so I’ll ask again: which sports do you want to cut because that reality for everyone.
@@kimcoulter806 🤷🏾♂️ I was just calling the Devil a Devil.
@@pwho405 my point wasn’t to attack you but to point out, doing nothing is a guaranteed death to programs outside the B10 & SEC. Who by the way will be under the same exact pressure. Btw: PE created a few brands you might of heard of and use: Costco, Amazon, EBay, Tesla, SpaceX just to name a few.
@@pwho405 just out of curiosity do you ever shop at or go to Costco, Home Depot/Lowes, Amazon, EBay etc fir goods or services? All were funded by Private Equity.
Guess what SEC & BIG10 your conferences are going to do the same thing!!! You guys are scared to death of the BIG12 catching up!!! So poke laugh do whatever I can't wait to hear what your conferences are going to come up with!!!;😮😮😮😮😮
The BIG and SEC don't need to do that. The BIG12 schools are only going to receive 62 million per school that will catch the BIG12 up for 2 years and after that the BIG 12 schools will only be getting 80% of future revenue.
@@LEE_65 well see only time will tell but for now or the next few years that gap will decrease. By the way if it doesn't matter because of your analogy, why does it matter or bother you guys??? Just let it fail if that's going to happen why care about it???
They don't need to sell off a percentage of their conference. They're making enough with their media deals.
The P2 doesn't have to do this. 😂 Keep in mind they already earn an extra $7 million per year in playoff revenue. So they equal this amount in 6 years without doing anything.
As a lifelong Longhorn fan, I really hate to see how this is all shaking 0ut. It was a sad day when Arkansas hauled ass to the SEC. That was the precursor to the fall of the SWC and the formation of the Big 12.
I believe that the end of the Big 12 being a "power conference" is is just a few years away. Equity money will run out. NEW annual TV/streaming money is the only time tested way to insure survival, at top tier levels.
Otherwise, the Big 12 is destined to be, as John would say, "a JOBBBER conference."
Boohoo, Texas DID this to the Big 12. If you and OU had stayed and fought the SEC instead of capitulating to them, maybe things could have been different. But you left. You don't get to have an opinion on your ex's decisions after leaving.
This is the beginning of the end
Yes it is
Yeah, I’m pretty close to not caring anymore.