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ACC Still Holding Off on Private Equity Despite Big 12 Leap
TL;DR
The ACC remains hesitant to adopt private equity options, according to commissioner Jim Phillips. Despite the Big 12's recent moves towards a $30 million credit line, the ACC sees no compelling reason to follow suit.
Key points
- ACC commissioner Jim Phillips stated the conference is not ready for private equity.
- The Big 12 has a $30 million line of credit available through a private capital deal.
- The ACC will revisit the topic of private equity in a meeting next week.
AMELIA ISLAND, FLA. ā The ACC is still not ready to embrace PE.
That was the gist of an answer from ACC commissioner Jim Phillips on Wednesday.
Front Office Sports asked Phillips at the ACC spring meetings about a majority of Big 12 schools saying they arenāt yet taking a $30 million line of credit offered through that conferenceās landmark private capital deal.
āTo date, thereās nothing that has made sense,ā Phillips said. āAnd so weāll look at it againāin fact weāll talk about it next week in Charlotteābut thereās nothing that has been put forward that interests us.ā
Phillips added, āWeāve looked at the RedBird deal, Iām happy for Brett [Yormark] that he got that done, he worked hard on that, thatās what he wanted to do for his league. And we know what that looks like for the ACC. But that just hasnāt been something our group has wanted to do.ā
Big 12 school presidents approved the conferenceās deal with RedBird Capital Partners and Weatherford Capital (founded by former FSU quarterback Drew Weatherford) that includes a $12.5 million infusion into the conference, opportunity to coinvest in new revenue opportunities for the conference, and a line of credit for up to $30 million for each individual school.
The schools have a year to choose to take that offer, but at this time, 13 of the 16 member schools say they are not taking it, while the remaining schools are not commenting. No Big 12 school has yet said it is taking the money. (RedBird IMI, in which RedBird Capital Partners is a joint venture partner, is the primary investor in Front Office Sports.)
Still, the deal provides an example for how other conferences might accept or make available to its schools money from private equity partners.
Phillips certainly left the door open for the ACC to still entertain a similar deal.
āWe have had a lot of education for our presidents on the PE space,ā he said. āWeāve brought in an awful lot of those kinds of groups and experts, and my job as commissioner is to educate the board, engage in discussion, and then garner their feedback and go off of that and move forwardā¦ and I think we have an awful lot of really bright, sophisticated finance presidents and chancellors in our group.ā
Last summer, Phillips told FOS āOur group is very educated about it, and there just hasnāt been anything that really has made sense for the ACC.ā It appears that the conference and its members remain unswayed nearly a year later despite arguably its most comparable peer making the jump.
The post ACC Still Holding Off on Private Equity Despite Big 12 Leap appeared first on Front Office Sports.
Q&A
Why is the ACC not embracing private equity deals?
The ACC believes that nothing proposed thus far has made sense for them, according to commissioner Jim Phillips.
What is the significance of the Big 12's $30 million line of credit?
The Big 12's credit line is part of a landmark private capital deal, which many schools in the conference are currently considering.
When will the ACC revisit the private equity discussion?
The ACC plans to discuss private equity options again next week in Charlotte.