From CBS News: Six months ago, Gerry Cardinale stood outside a conference room at the swank Aria Resort and Casino in Las Vegas having already blown away of roomful of attendees during the annual Sports Business Journal Collegiate Athletic Forum.
During his remarks, the RedBird Capital founder and CEO expanded on his private equity firm partnering with LeBron James to bring an NBA expansion team to Las Vegas. As if that wasn't eyebrow-raising enough, he added that private equity was ready to jump into the college sports landscape cleats first. He specifically pointed to college football being tremendously undervalued.
In terms of total revenue compared to the NFL, college football was earning five times less. In terms of media rights revenue, 10 times less. "We should close that gap," Cardinale insisted.
That was a bit shocking to hear from a financial wizard. Or, perhaps it shouldn't have been. Last August, RedBird Capital led an acquisition of soccer giant AC Milan for $1.3 billion. It already has a stake in the Pittsburgh Penguins and Boston Red Sox. There were reasons the college gap existed. Schools and athletes were constricted by NCAA rules. Athletic departments were business capitalistic enterprises overseen by a non-profit NCAA. Oil and water get along better.
But with the House v. NCAA settlement on Thursday, the infiltration of private financing into college sports became all but official as the NCAA and the Power Five conferences came to the landmark agreement. The $2.8 billion settlement has opened the door to that influence. The proof was being laid out that day following Cardinale's presentation. He was asked by a New York Times reporter, hypothetically, how much would Michigan football be worth as an investment by his company? "I'd say it's worth at least a billion dollars," Cardinale said...
Also from CBS News: Athletic directors at Penn State and UCLA have denied their schools are involved in private equity funding, even as last week's landmark House v. NCAA settlement opened the door for private equity to enter the college sports universe. Pat Kraft (Penn State) and Martin Jarmond (UCLA) told Yahoo Sports' Ross Dellenger that partnerships with sports consulting firm Elevate do not include private capital. This, in response a report from Sportico that the Big Ten members became debut partners in Elevate's new $500 million program to fund college athletic departments.
"Elevate is a current ticketing partner of UCLA Athletics, and we are exploring the opportunity to expand the partnership, but private equity funding is not involved," Jarmond told Dellenger. On Monday, Elevate revealed its College Investment Initiative, which is fully funded by Velocity Capital Management and the Texas Permanent School Fund. Velocity, which is owned by David Abrams and Indonesian billionaire Robert Budi Hartono, opened three years ago and had $257 million in assets as of December 2024, per Sportico. The Texas Permanent School Fund holds more than $57 billion in assets and benefits grade and high schools in Texas.
"Elevate serves as our partner in ticketing strategy and operations," Kraft told Dellenger. "To clarify, our relationship is strictly limited to these services. We have no affiliation or involvement with any private equity firm or fund." ...
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