Big XII vs ACC perception
- Thread starter ThePanthers
- Start date
I dont think people understand that making a deal with private equity isnt this great thing everyone makes it out to be. Yes, it gives them a cash infusion now but they have to sell a portion of their league to do it. In the minds of the PE firm, the PE firm wins that deal.
Nobody is better at propoganda than the Big 12. So so good at it.
They don’t have to sell a portion of their league. They’d be getting a cash infusion now and giving up a percentage of revenues for a set number of terms into the future.
That’s insane
The B12 is a AAC/MWC merger conference
Stability of the B12?
The conference where the 4 biggest name programs left as soon as possible ?
Nebraska , Texas A&M, Texas, and Oklahoma .
Because Colorado came back after the PAC was raised isn’t saying much .
pittdan77
Athletic Director
pittdan77
Athletic Director
Keep in mind that they'll tell you that the ACC is just garbage but in the same breath, this big conference wants these schools and that big conference wants those schools. You can't make it make sense.
Same thing. The private equity bros who do this for a living think future revenue streams are worth more than paying them X amount of dollars now. Its a big risk to sell a percentage of your league. You are sacrificing the future for the present. And the thing is, is that really necessary? What is Iowa State and Cincinnati going to do with this extra money? The B12 is still only getting 1 team in the CFP, maybe 2 in some seasons.
Just remember that last year all of the leaks were saying that the B1G had no interest in adding Washington & Oregon.
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Until they did.
The P2 will benefit greatly in negotiations if FSU & Clemson are in desperation mode.
Millions of dollars are in play
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Until they did.
The P2 will benefit greatly in negotiations if FSU & Clemson are in desperation mode.
Millions of dollars are in play
The SEC doesn't want another Florida team but may take them to keep the B10 out of Florida. The B10 will 1 million percent take FSU. No question at all about that. This is all just posturing.
Yeah, things change quickly, but it all is contingent on the ACC staying intact, per the article. Just like the B10 didn't have interest in Washington and Oregon while the Pac was intact. And what really pushed them to grab them was they got them at a huge discount when the went into desperation mode when the Pac imploded and that otherwise they were very close to heading to the ACC which would have locked them into a GOR.
Is the ACC actually going to implode? Per the article, it really makes no sense at this point that FSU isn't trying to rally the ACC to make the best of it at least through the end of the GOR in 2036. Their legal case is extremely weak by all accounts. It is all driven by misled and false internet-based fan hysteria.
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Saying the BG10 and SEC will not add teams if the ACC survives is not really breaking news.
If the ACC survives, it’s because the GOR held up in court. And that means the Super 2 can’t get anything out of adding those teams that leave.
Did anybody think that would not be the case?
If the ACC survives, it’s because the GOR held up in court. And that means the Super 2 can’t get anything out of adding those teams that leave.
Did anybody think that would not be the case?
Right. This is nothing. The B10 isnt adding FSU because they don't get the rights to their home games. If FSU gets out of that, then they will invite them.
You don't get something for nothing. I'd think about unequal revenue sharing based on some formula of media value that could theoretically apply to any team IF they extend the GOR, say through 2040 or 2045, and waive further rights to challenge it. It makes no sense to take money from Pitt to give it to FSU and Clemson just for them to leave in a decade. If they actually showed some commitment to the conference, that may be a different story.
The question here is not what the Big Ten or SEC will do if they leave the ACC.
The question is: Why would FSU and Clemson jump to the Big 12????
In order for FSU and Clemson to go to the Big 12, they will want a much bigger piece of the pie. If the Big 12 members won't do that for Oklahoma and Texas, why would they give it to FSU and Clemson???? Both are lower in stature than either OK or UT.
The Big Ten and the SEC are destination conferences. The Big 12 is not. The best option for FSU and Clemson is to stay put. But everyone knows, FSU is not a good partner and they won't be for any other conference as well...
pittdan77
Athletic Director
He doesn't understand negotiations or how you have to give something to get something.
pittdan77
Athletic Director
The Big12 is a bunch or schools that have pandered to other schools in their conference so it's not completely wrong to say they may be willing to give FSU and Clemson much greater shares of the pot. The "not a great partner" has to sting a little.
Not really because after the contractual number of future payments are made the two parties go their separate ways. And at no point during the contract period would the private equity group have much say beyond contract negotiations involving those future revenue payments. It’s more like a business loan than an ownership agreement.
Ownership of the conference and purchasing future revenue streams are definitely not the same thing. I compared this to the deal Barcelona made a few years ago. That private equity group does NOT own a single share in the football club. They only own a percentage of future revenues.
Its essentially the same thing. The only difference is the PE bros wont officially make ownership decisions but surely, they will have an influence. Here's the thing, nobody "owns" the Big 12. All it is is a governing body for 16 schools so they cant actually buy the league, there's nothing to buy. But they are buying future revenue which is basically buying a portion of the league without actually doing it.
This is all so stupid. The B12 propagandists think this is such a great thing. Meanwhile if there was a message board for this PE firm, their "fans" would be saying how great it is to give the B12 a small amount for future revenue streams.
THEY WOULDN'T!!!!
This is just negotiating leverage to get a better deal from the ACC. "See, look what the B12 will do for us now give us what we want or we'll go play Iowa State, Houston, and Arizona."
I agree with this except saying it’s essentially the same thing. It’s not at all the same thing. If I win a lawsuit that pays me $200 per month for 10 years, and sell you that $24,000 of future payments for $15,000 right now, you don’t own me at all. Now, I know there’s more minutiae in a potential big 12 deal than my example. But keeping the conversation simple it’s closer to my example than anything that could be considered “ownership”.
pittdan77
Athletic Director
You really think the PE guys just write a loan and sit on the sidelines? PE doesn't get involved without taking an interest with how things are run. Any bank can passively loan money. That's not what PE does.
Their risk and return is much higher than any bank will accept. Unless the Big 12 is completely stupid, the only say the equity group should have is concerning future revenue negotiations (assuming the agreement overlaps that timeframe).
A college program? As far as I know, PE is new to college football. I’ve only heard of it with FSU and their buyout and this stuff with the Big XII.
Being lazy and not looking it up. What was the reason for the Barcelona owner selling out to PE? The PE is a max inclusion of cash. I heard the Big 12 using PE to buy out any eventual settlement amount for FSU and Clemson.
Barcelona doesn't really have an owner the way that, for instance, we think of Bob Nutting owning the Pirates. Their board decided to sell out to a PE because they were over a billion in debt, and there are rules in the European soccer leagues about how much you can spend versus how much money you bring in. They were in a position where to bring in any new players they had to sell off other, more expensive players.
At one time their payroll was around $700 million for a season. Their limit for next year is down to $220 million. They sold out because they were desperate for money, so they made a deal for money now in exchange for a lot more money later. It keeps them competitive today, but they have pretty well screwed themselves over for the future.
Barcelona is owned by its fans. And as you mentioned has a board that makes decisions like selling 25% of their TV revenue for 25 years for a one time cash infusion to keep them out of futbol jail. I can’t see how that decision doesn’t haunt them for years to come.
pittdan77
Athletic Director
And that is my point. With that sort of risk, nobody sits passively on the sidelines and just lets the day to day business happen without input. In most cases, having the ability to slash costs is extremely important to PE.
I mean it’s literally their job -
Gut out the company , pump the stock price - and then leave as the company closed
pittdan77
Athletic Director
Yeah, I keep reading about this potential deal and I don't think people really understand. There is this new trend in junior sports where these PE firms gobble up clubs and tournaments and try to control every dollar through the system. You end up with one or two "super" teams and a lot of teams that are just there for the sake of charging the fees. But it's all about controlling expenses and maxing out on profit. Tournament quality has really gone down the drain as a result and there are a lot of mediocre kids filling teams that don't get coaches until a week before their first game, all while their parents see the fees climb every year. When PE gets into something, they aren't afraid to destroy it if it means squeezing those last few dollars out of it. Think of how the Pirate organization is run and that's very similar to what you're ending up with.
Right, if all revenues were part of what is potentially being sold. It was my understanding that only Network TV revenue was in play - similar to the Barcelona deal. From that standpoint, it really comes down to how many years the repayments run. If they go beyond the current TV deal, then I could see them trying to meddle to increase the next contract. If not, there is nothing to meddle with. The payments and terms are already fixed.
pittdan77
Athletic Director
So Fox will be sitting there listening to the conference asking for more money that at least in part, goes to a non revenue generating partner. That would be a fun conversation.
