According to a new report from EerSports, West Virginia University is the latest program to turn down a $30 million line of credit as part of a five-year partnership between RedBird Capital, Weatherford Capital and the Big 12 Conference.
Per EerSports, “Sources familiar with the decision told EerSports there is a “consensus” across campus to decline the opportunity. While the money would benefit the athletic department, the president and the board of governors would have to endorse the idea, and WVU instead favors other options.“
As part of the offer, the Big 12 was granted a $12.5 million line of credit, while each of the 16 members in the league have access to a $30 million line of credit.
West Virginia would be joining Houston and UCF in deciding it will not opt into the line of credit. The line of credit offered to Big 12 schools is believed to have a 10% interest rate attached to it, which is attractive in today’s current market.
That cash obviously could boost schools in bankrolling their athletic departments and student-athletes, but it also has legit long-term ramifications for the conference when it comes to television rights.
Like many schools, West Virginia is working on developing activation and revenue opportunities around Milan Puskar Stadium and Hope Coliseum, including paying $4 million for a hotel and land near the Coliseum.
The Big 12 remains in the arms race against the SEC and Big Ten, whose revenues each topped $1 billion, with the Big Ten leading the way at nearly $1.5 billion and the SEC coming in just over $1 billion. But at least for now, multiple Big 12 schools are not interested in biting on the private equity line of credit offer. We’ll see if anything changes in the near future.
