May 22, 2024

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A new private equity fund focused on college sports looks to have major ramifications on a part of the sports industry already experiencing seismic change. … This year’s Serie A champion is under new ownership after a loan default, signaling further economic issues within Italian pro soccer. … Fox NFL analyst Greg Olsen is set to appear on Front Office Sports Today. … Plus: More on private equity in the NFL, the Timberwolves, the city of Pittsburgh, and the NBA.

— Amanda Christovich [[link removed]], Eric Fisher [[link removed]], and David Rumsey [[link removed]]

Private Equity Set to Enter College Sports for First Time in NCAA History [[link removed]]

Dylan Widger-USA TODAY Sports

This week, power conferences (including the former Pac-12) and the NCAA are voting to authorize a settlement [[link removed]] in House v. NCAA, which argues that athletes deserve back pay for not being able to participate in name, image, and likeness deals before 2021, and that they should receive a cut of broadcast revenue. So far, two conferences have agreed to the settlement terms: $2.7 billion in damages split between the NCAA and power conferences, as well as a framework for Power 4 schools to revenue-share with athletes up to $20 million per school per year, a source confirmed to Front Office Sports.

While some of the richest athletic departments may not have a problem covering the extra cost, others will go in search of extra revenue streams. At perhaps just the right time, private equity, rumored to have an interest [[link removed]] in college sports for at least a year, appears to be entering the athletic department space for the first time in NCAA history.

On Wednesday, RedBird Capital Partners and Weatherford Capital (of which former FSU quarterback Drew Weatherford is a partner) announced the launch of an investment arm intended to infuse capital into athletic departments. Collegiate Athletic Solutions plans to offer $50 million to $200 million in each department, according to The Wall Street Journal. [[link removed]]

“The paradigm shift we are seeing in the collegiate athletics ecosystem is similar to the ones we’ve seen with media distribution models, collective bargaining rights, and premium hospitality,” RedBird founder and managing partner Gerry Cardinale said. “CAS addresses athletic departments’ need for near-term capital with additional operational expertise across strategies that can improve competitive positioning.”

The firms aren’t investing in exchange for an ownership stake, however. CAS will provide capital to athletic departments and only expect a return based on how much revenue or profit the schools can generate from those investments. RedBird and Weatherford will advise athletic departments and schools, they said, but also will not require any sort of official in-house position.

College sports administrators appear to have mixed feelings on the subject. While outgoing AAC commissioner Mike Aresco has expressed concern [[link removed]] about the idea, incoming commissioner Tim Pernetti has already signaled interest [[link removed]].

There are positives: The immediate cash flow is a plus for athletic departments wondering how they’ll cough up an extra $20 million per year. Schools will also get access to counsel from successful firms well versed in the greater sports landscape.

A Bad Reputation?

But there is a concern about the general nefarious reputation of the private equity industry. “Go look at Red Lobster,” said one industry source, referring to the once-popular restaurant chain that filed for bankruptcy this week, a decade after being purchased [[link removed]] by a PE firm. (The Red Lobster deal was, however, structured differently than the proposed deals between RedBird/Weatherford and athletic departments.)

While the RedBird/Weatherford investment arm might be private equity’s inaugural foray into actual athletic departments, the greater college sports industry has already become entangled. Third-party companies participating in college sports, such as Legends and OneTeam Partners, have accepted investments.

As for where the House settlement stands: The Big 12 and ACC [[link removed]] voted to authorize the agreement Tuesday. The Big Ten will likely vote sometime Wednesday, with the rest of the votes concluding by the end of the day Thursday, sources said. But the agreement will still face scrutiny from other parties, including a judge, plaintiffs lawyers, and athletes, before it is officially ratified.

Editors’ note: RedBird IMI, of which RedBird Capital Partners is a joint venture partner, is an investor in Front Office Sports.

U.S. Investor Takes Over Inter Milan: What’s Next for the Serie A Champs? [[link removed]]

Inter Milan

The often-chaotic state of Italian pro soccer has taken another hit as Inter Milan, this season’s Serie A champion, has been taken over by U.S.-based investment fund Oaktree Capital Management.

Oaktree became the new owner after the club’s Chinese holding company, Suning, missed a $428 million loan payment deadline Tuesday, in turn defaulting on the loan. Suning, which acquired a majority interest in Inter Milan in 2016, received the emergency bridge loan from Oaktree five years later to help manage club finances during the COVID-19 pandemic, when critical gate revenues were not arriving due to closed stadiums.

More recently, Suning had been attempting to refinance its debt, including a potential sale of the club, but was unable to do so. As a result, even one of the most famous brands in European soccer is now the subject of a creditor takeover.

“We are committed to the long-term success of the Nerazzurri and believe our ambitions for the club are united with those of its passionate fans in Italy and around the world,” said Alejandro Cano, managing director and co-head of Europe for Oaktree’s global opportunities strategy. “Our initial focus is operational and financial stability.”

Inter Milan president Steven Zhang, a key figure within Suning, pushed back on Oaktree’s actions, saying “such behavior now poses potential risks to the club that could seriously jeopardize its stability.”

Bigger Financial Issues

Six additional Serie A clubs have U.S. ownership: AC Milan, Atalanta, Fiorentina, Roma, Genoa, and the newly promoted Parma. But Serie A continues to lag [[link removed]] well behind not only the Premier League in total revenue but also Spain’s LaLiga and Germany’s Bundesliga.

And despite a still-growing investment in Italian soccer by American entities, Serie A in 2022 also posted [[link removed]] its worst collective financial loss in 15 years. Many owners of Italian clubs—including Inter Milan—have also sought to elevate their fiscal situations through enhanced facilities [[link removed]], only to find resistance in numerous areas, particularly regulatory and political ones.

“There’s a big gap between Serie A and the other leagues,” said former AC Milan star Zlatan Ibrahimović earlier this year at a Financial Times conference. “It’s all about the budget, the economics. Italy needs something more; they need something new.”

Inter Milan will conclude the 2023–24 Serie A season Sunday, but clinched its 20th league title last month.

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FRONT OFFICE SPORTS TODAY Greg Olsen on Brady and Broadcasting

Denny Medley-USA TODAY Sports

Greg Olsen has had a roller coaster of an offseason, getting bumped by Tom Brady as Fox’s No. 1 game analyst and announcing a Series A funding round for Youth Inc., his start-up focused on youth sports. On Tuesday, Olsen won another Emmy for his work in the booth, adding to the strangeness of him being replaced for that job. He will work with play-by-play announcer Joe Davis on Fox’s second team for the upcoming season.

He joined Front Office Sports Today [[link removed]] to discuss broadcasting, youth sports, and today’s NFL, and the interview will air on Thursday’s show. Here’s a sneak peek at what Olsen had to say.

On his approach to next season

I’m excited to work with Joe. I think that Joe and I’s goal is very much the same—and this is not a disrespect to anyone at our network or disrespect to anyone at other networks—I think the goal is that we’re the best team out there, and that’s what we’re working towards.

On being replaced by Tom Brady

I think I’d be lying if I said it wasn’t tough at times, right? I loved calling those games. It’s great being on the top team. It’s great working with Kevin [Burkhardt] and Erin [Andrews] and Tom [Rinaldi] and our crew—it’s a world-class crew. It’s not a mistake why that team has called multiple Super Bowls and called some of the biggest games in the last decade. That’s not by accident, and it was awesome to be along that journey with them for the past two years and learn and improve and grow as a broadcaster and an analyst. But listen, life sometimes is out of your control.

On his broadcasting future

My aspirations are still to be a No. 1 analyst, whether it’s at Fox or elsewhere. And that will never change as long as I do this. I’m not just content to be there. I’m not just happy to have a seat. I want the top seat and I want that wherever that opportunity allows and I’ll never stop working for that. I feel more motivated for that now than ever.

🎧 Watch, listen, and subscribe on Apple [[link removed]], Google [[link removed]], Spotify [[link removed]], and YouTube [[link removed]].

STATUS REPORT Two Up, One Down, One Push

Kirby Lee-USA TODAY Sports

NFL private equity ⬆⬇ Roger Goodell said [[link removed]] that there was no vote at this week’s owners meetings on allowing institutional investors to acquire minority stakes in franchises. However, the commissioner said there was “real progress” made in discussions and that there could be a resolution by the end of the year.

Gubernatorial creativity ⬆ Minnesota Gov. Tim Walz doubled down on the state’s new Timberwolves-inspired tourism push [[link removed]], in which he issued [[link removed]] a proclamation Wednesday in support of the team that, when using the first letter of each individual clause within it, spells out “Bring Ya Ass.”

Pittsburgh ⬆ As expected, the NFL selected the Steelers’ home as the site of the 2026 draft. The choice continues a recent run [[link removed]] by the league of selecting Midwest and Rust Belt towns for the showcase event.

NBA ⬇ Viewership for the first two rounds of the playoffs is down [[link removed]] 11% from last season, with games averaging 3.77 million viewers across ABC, ESPN, TNT/truTV, and NBA TV.

FRONT OFFICE SPORTS AWARDS

2024 Best Venues Award Winners Revealed

Congratulations to this year’s Best Venues Award Winners [[link removed]]: Wells Fargo Center, State Farm Arena, TD Garden, Churchill Downs Racetrack, Citi Field, Globe Life Field, Moody Center, Prudential Center, Frost Bank Center, and Hard Rock Stadium.

This year’s winners were determined by Sports Innovation Lab through their data-driven methodology. Venues across the industry submitted applications and responded to questions ranging from in-venue technology to overall venue design.

Learn more about the winners here. [[link removed]]

Conversation Starters After 158 years, Birmingham-Southern College is closing its doors May 31. Its baseball team, however, just advanced [[link removed]] to the Division III Super Regionals. If the Panthers advance to the College World Series, they’ll technically be playing for a school that no longer exists. The first two rounds of the 2024 Stanley Cup playoffs are now the most watched [[link removed]] in NHL history, with games averaging 1.16 million viewers across ABC, ESPN, ESPN2, TNT, TBS, and truTV. The NBA’s Timberwolves and WNBA’s Lynx share a $25 million headquarters that’s been called “a game-changer.” Look here [[link removed]]. Editors’ Picks Lawsuit Claims LaMelo Ball Ran Over Young Fan With His Car [[link removed]]by Margaret Fleming [[link removed]]A mother and son are suing Ball and the Hornets over an October incident. Deep Playoff Run Ups Ante in T-Wolves’ Ownership Saga, Experts Say [[link removed]]by Alex Schiffer [[link removed]]Even skeptics acknowledge a title run could significantly increase the team’s valuation. FBI Raids Prosecutor Who Led Mississippi Welfare Case That Ensnared Favre [[link removed]]by A.J. Perez [[link removed]]Jody Owens had his office and nearby business searched by the feds. Careers in Sports

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