The Pac-12 Conference has plans to sell a 10 percent stake in itself to private equity investors for $500 million, according to media reports, citing the plan to help Pac-12’s fortunes, which have stumbled in recent years.
The Oregonian reported Saturday that the plan was presented by conference commissioner Larry Scott to Pac-12 university presidents and chancellors in November and discussed in December.
Since Scott was hired as commissioner in 2009, Pac-12 revenue has grown to $500 million from $100 million, and the average amount each member school receives from the conference has nearly quadrupled, reported The New York Times. But compared with the other four Power 5 conferences, the Pac-12 still lags behind. It was last in the amount of money it distributed to members in 2009, and second to last in 2016. It will likely soon be last again, when the ACC Network is launched next year.
The new plan for distribution rights would also create a large increase in revenue.
The report said, “based on the Pac-12’s current media rights deals and making conservative assumptions going forward, we estimate that a Capitalized NewCo could be valued at approximately $5 billion to $8.5 billion.”
The projections, however, include $36 million in annual revenue from DirecTV beginning in 2020 and a one-time payment in 2024 from ESPN in the amount of $347 million. Neither is certain. Also, the plan assumes FOX would renew its current broadcast contract with the Pac-12 in a 10-year deal worth more than $2 billion.
