Here's the main problem: What happens after each school...
Posted on: June 13, 2024 at 17:19:36 CT
zounami MU
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quickly blows through the extra $62M this generates?
It's a temporary bandaid to stay financially on par with the B1G and SEC for a couple years, but after the money is spent, the Big 12 will be at an even greater disadvantage since 20% of its cash flows will be going to a private equity firm instead of its members.
It's very short-sighted, and the risk for the private equity firm is that a financially crippled Big 12 (by this deal) will be even *less* competitive with the B1G and SEC (i.e., closer to a G5 conference), and thus less valuable. Suddenly, that 20% stake is worth a fraction of what you paid for it.
By the way, this deal is equivalent to receiving a one-off $62 million donation — like Mizzou recently received, coincidentally. The difference is that Mizzou didn't have to sell 20% of its future conference-related earnings for it.