Alabama in talks with Private Equity Firms to sell part of athletic department?

[rezero]

I heard tonight on the Sports Animal that Bama has been in talks with private equity firms on funding models for the extra $20M to pay players, plus work down the red ink they have been bleeding. My guess if a team like Bama is working down that angle there are many more. This is the only article I could find, and it just touches on the topic, but they seemed to think it is much more likely on the radio than what is shown in the article.

https://alabama.rivals.com/news/could-a ... y-players-

[jcgmoi]

From your link:

Alabama . . . lost close to $28 million for the 2023-24 fiscal year after losing $12 million for 2022-23.

I believe every school uses creative accounting to make their profit/loss numbers best fit whatever their needs might be at the moment.

For example, here's a report dated March last year that shows Alabama with $214M in total revenue and $195M total expenses which doesn't match either number above.

https://sportsdata.usatoday.com/ncaa/finances

[winonsports]

I heard tonight on the Sports Animal that Bama has been in talks with private equity firms on funding models for the extra $20M to pay players

Mizzou has had something similar in place with its collectives ever since Now It's Legal became a reality.

[edwin drood]

I heard tonight on the Sports Animal that Bama has been in talks with private equity firms on funding models for the extra $20M to pay players

Mizzou has had something similar in place with its collectives ever since Now It's Legal became a reality.

And the kids across the street running the lemonade stand are quite similar to The Coca Cola Company.

[winonsports]

I heard tonight on the Sports Animal that Bama has been in talks with private equity firms on funding models for the extra $20M to pay players

Mizzou has had something similar in place with its collectives ever since Now It's Legal became a reality.

And the kids across the street running the lemonade stand are quite similar to The Coca Cola Company.

Another example of showing that the N does stand for Knowledge.

That is one of the stupidest correlations I've ever read.

[rezero]

I heard tonight on the Sports Animal that Bama has been in talks with private equity firms on funding models for the extra $20M to pay players

Mizzou has had something similar in place with its collectives ever since Now It's Legal became a reality.

And the kids across the street running the lemonade stand are quite similar to The Coca Cola Company.

Agree. Apples and Watermelons. What is happening is schools and athletic departments are starting to split (see UK) and Private Equity firms will start working their way into the ownership of college athletics. The large schools have high intrinsic value can delay and watch the landscape before making a move. For example, there will always be someone willing to buy Notre Dame athletics department for $500-600M. The problem will be the next tier schools that do not move first as there is only so much money to go around.

[edwin drood]

I heard tonight on the Sports Animal that Bama has been in talks with private equity firms on funding models for the extra $20M to pay players

Mizzou has had something similar in place with its collectives ever since Now It's Legal became a reality.

And the kids across the street running the lemonade stand are quite similar to The Coca Cola Company.

Agree. Apples and Watermelons. What is happening is schools and athletic departments are starting to split (see UK) and Private Equity firms will start working their way into the ownership of college athletics. The large schools have high intrinsic value can delay and watch the landscape before making a move. For example, there will always be someone willing to buy Notre Dame athletics department for $500-600M. The problem will be the next tier schools that do not move first as there is only so much money to go around.

Exactly. I'm most interested in seeing how these investors will see a return on their investment. If an investor group puts up $1 million for a top QB, do they get a cut of all ticket sales, or do they gamble and go for a cut of the expected NFL (or NBA) contract? And what happens to the so- called "Olympic" sports? Those lower attendance sports like soccer, track and field, field hockey.. Today, those sports are largely funded by football and basketball. What's their future? It's a brave new world.

[winonsports]

What is happening is schools and athletic departments are starting to split (see UK) and Private Equity firms will start working their way into the ownership of college athletics.

If they take ownership, then they will have to own and FUND the entire department and all the sports they support.

Most athletic departments strive to break even, so any investment will have a tough time showing any dividends. The only perks most investors will see will be being part of the atmosphere around the team.

[dhsux]

I apologize but I am a bit confused.

Does the 20 million dollar institution "arrangement" cap out at 20 million for ALL NIL activity or can the NIL activity continue beyond on a player by player basis with outside supporters??

I'm assuming the idea here is to get some control and order and cap it all at the 20m........is that correct?

[jcgmoi]

The $20.5M applies only to the schools.

Meet the new College Sports Commission which will "analyze third-party deals worth $600 or more to make sure they are paying players an appropriate “market value” for the services being provided."

If you think that sounds iffy and subject to court challenges, I agree.

More info here: https://www.espn.com/college-sports/sto ... -nil-rules

[dhsux]

The $20.5M applies only to the schools.

Meet the new College Sports Commission which will "analyze third-party deals worth $600 or more to make sure they are paying players an appropriate “market value” for the services being provided."

If you think that sounds iffy and subject to court challenges, I agree.

More info here: https://www.espn.com/college-sports/sto ... -nil-rules

Thanks

Money on top of money.

[edwin drood]

I apologize but I am a bit confused.

Does the 20 million dollar institution "arrangement" cap out at 20 million for ALL NIL activity or can the NIL activity continue beyond on a player by player basis with outside supporters??

I'm assuming the idea here is to get some control and order and cap it all at the 20m........is that correct?

The $20.5 million is IN ADDITION to NIL deals. A star QB could potentially be paid $400,000 per season, plus do tv ads for the local Ford dealer and do State Farm ads with Caitlin Clark. The $20.5 will go up 4% in 2 years and be re-evaluated every 3 years
for the 10 year settlement period. What happens in year 11 I haven't a clue.

And to make things more interesting, players from the last 9 years are also eligible to be paid. So, in addition to paying Beau Pribula, Mizzou might be paying Drew Lock and Larry Rountree as well.

Toto, I don't think we're in Kansas anymore...

[rezero]

What is happening is schools and athletic departments are starting to split (see UK) and Private Equity firms will start working their way into the ownership of college athletics.

If they take ownership, then they will have to own and FUND the entire department and all the sports they support.

Most athletic departments strive to break even, so any investment will have a tough time showing any dividends. The only perks most investors will see will be being part of the atmosphere around the team.

“Investors” don’t want part of the atmosphere as these private equity firms have a pool of investors (many overseas) that buy into their investments. They simply want a return on their investment. There is nothing that says they need do but X or Y. I could see them offering to buy just the football program and the school bankroll the money to fund other sports (or not). This is uncharted waters but if I am an investor into one of these private equity funds I am not sure I want a piece of women’s golf or water polo.