Big Ten member schools are set to vote on whether or not to accept an investment deal that could inject more than $2 billion into the conference, multiple media outlets reported Friday.
However, the deal is still uncertain, apparently due to the uniqueness of the storyline and the complexity of setting it up.
The deal being considered is for a private investment company that manages the University of California system’s retirement portfolio. According to Yahoo Sports, the company – UC Investments – is valued at $190 billion and manages the endowment and retirement savings for all 10 schools in the UC system. The fund is independent of the UC schools, whose largest football programs are UCLA and Cal.
But Front Office Sports reported Friday that some Big Ten schools did not know what pension fund was contemplated in the deal.
Reports indicate a vote could take place early next week.
The main structure of the deal would include UC Investments, giving the 18 Big Ten schools a total of $2.4 billion in exchange for a 10% stake in Big Ten Enterprises — a Big Ten subsidiary that would be created to manage tradable assets such as media rights and sponsorship deals.
According to Yahoo, each school would receive at least $100 million in a single upfront payment, with future payments based on each school’s performance and marketing metrics. The conference and UC Investments would also extend the schools’ media rights deal through 2046.
Media rights to the conference, however, would not be part of the deal. The Big Ten’s deal that shares television rights with Fox, NBC and CBS expires in 2030, while a separate deal with Fox doesn’t expire until 2036. Yahoo reported that the deal with UC Investments would include eight-figure bonuses for the schools in fiscal 2037, indicating that a big increase in media rights fees is expected after the current deal with Fox closes.
Sen. Maria Cantwell (D-Wash.) wrote a letter to Big Ten presidents warning them against entering into deals with private companies.
Cantwell’s letter said in part that such an agreement “may run counter to your university’s academic goals, may require the sale of university assets to a private investor, and may affect the tax-exempt purpose of those assets.”
Echoing FOS’s report that not all Big Ten institutions knew the details of the fund involved in the deal, Cantwell wrote that she had heard from conference regents and administrators who “had not been fully briefed on the deal under consideration.”
–Field level media
