It’s been nearly five months since Yahoo Sports’ Ross Dellenger reported the Big 12 Conference was on the doorstep of a private equity deal. Now, it’s nearly official.
On Wednesday, Dellenger reported that the Big 12, RedBird Capital and Weatherford had agreed to a new private equity deal. Back then, it was reportedly a proposed $500 million infusion of cash for the league and its member schools. The Big 12 has not officially sent a release announcing the partnership. It’s the first private equity deal for a college conference.
In December, Front Office Sports’ Amanda Christovich reported that Big 12 schools would have access to up to $30 million in cash and the league office would get $25 million to fund a new entity called Big 12 Properties. The funding would come under the umbrella of a new spinoff called Collegiate Athletic Solutions.
Now, per Dellenger, Big 12 schools will have access to the same amount while the league office will get $12.5 million up front. There is also a strategic partnership that could bring in more revenue. That comes to a little less than the $500 million originally quoted. It’s also a five-year deal. Dellenger reported that the league’s presidents and chancellors ratified the five-year agreement.
The Big 12’s schools have a year to determine if they want to use the money. Dellenger quoted insiders that said anywhere from two to six schools may tap into the money. Schools are not under any obligation to use it.
But here’s why the move could REALLY matter.
The Big 12’s Long Game
One massive thing that has changed in the past few months is the sports television landscape. CBS is now owned by Paramount, which is now nearing the completion of the acquisition of TNT. While the two networks have been long-time NCAA Tournament partners, they are also partners of the Big 12 Conference, albeit through sub-license deals with ESPN, a contract that ends after the 2030-31 academic year.
Putting the two networks under the same ownership umbrella could amplify the Big 12’s presence on their networks. It also could pave the way for a bigger deal with the Big 12 and CBS/TNT/Paramount after their current deal ends. Why?
As Dellenger reported, RedBird holds $15 billion in assets and that includes an interest in Paramount Global.
It’s not hard to connect the dots. The Big 12 already enjoys a good relationship with CBS and TNT. RedBird builds a relationship with the Big 12 and helps the league build a deeper relationship with the conference. As part of the CBS/TNT merger, Paramount will have sports on CBS, CBS Sports Network and its streaming service, Paramount+, along with sports on TNT, TBS, truTV and any other network under the Turner umbrella that broadcast sports.
The key? Aside from Paramount streaming, those channels are linear. The benefit of the sub-license is that it takes games that would be on ESPN+ and moves them to a linear channel. ESPN makes money and the Big 12 gets games on linear channels that they wouldn’t ordinarily be.
Down the line, that sub-license relationship could become a full-blown partnership where the Big 12 takes some or even the majority of its carriage to a CBS-TNT partnership and puts its games on networks that will showcase them more than ESPN currently does.
That doesn’t mean tank the relationship with ESPN. They’re still partners for several years. Commissioner Brett Yormark needs them at the table to get the best possible next television deal. But this allows his league to get further embedded in a potential partnership that could be just as good, if not better, for the league down the road.
The private equity is nice. But for those playing the long game, that’s the nugget that matters.
