Florida State Taps J.P. Morgan For Institutional Money as Talks Advance With PE Firm

[How Sway?!]

Why does FSU need $300 million from private equity? Only if they are planning to buy the ACC network from ESPN and Raycom.

If they control the ACC network, then they control the media rights of their conference peers. They can say: free us from this grant of rights, or the ACC network is all FSU all the time, and your time slot is 4 am Monday morning.

And then they say: UNC, UVa, etc, you can go to B1G or SEC if you pay us $100 mn to buy out your GoR. It makes financial sense for the top ACC teams and the private equity groups get their money back.

I have to say, that would lead to an immensely entertaining negotiation.

The ACC network is worth a whole lot more than 300 million.

 

[hardcorehusky]

Buying back 12 or 13 years of GOR is $300M right there before Exit fees

 

[billybud]

But are they really ready to do something? IMO their's no need to talk, if you have conviction, just do it

I think so....but sometimes you burn the boats on the beach so there is no talk of retreat.

There are many audiences...the fans, donors, the ACC, other conferences.

FSU has always been the odd child in the ACC....the protagonist to the conference of Tobacco Road. Ever since Duke and UNC voted "no" to adding FSU, there has been tension. Winning 11 of the first 12 ACC football championships upon joining didn't help.

And if you give me weed, whites and wine
And you show me a sign
And I'll be willin' to be movin'

 

[billybud]

$300 million was an estimated negotiated cost for a buy out.

 

[huskymedic]

Its the internet...

 

[billybud]

Going Indy is not an option...unless you have a big indy contract like Notre Dame is pushing.

Indy is another word for non competitive in finances.

And this guy is a UNC radio guy....grain of salt.

 

[goskis2018]

Just here to drop in and say, all of you who thought the ACC buy out was insurmountable can’t see the bigger picture. Bigger hurdle is going to be state govs (UNC leaving all of the other NC schools for dead as an example)

The coming Power 2 will have payouts that were unimaginable when the ACC signed their deal.

Inside scoop from my boss and major UNC donor, expect UNC plus 1-3 other schools to announce their moves to the SEC within the next year (goal is next summer)

 

[nelsonmuntz]

Just here to drop in and say, all of you who thought the ACC buy out was insurmountable can’t see the bigger picture. Bigger hurdle is going to be state govs (UNC leaving all of the other NC schools for dead as an example)

The coming Power 2 will have payouts that were unimaginable when the ACC signed their deal.

Inside scoop from my boss and major UNC donor, expect UNC plus 1-3 other schools to announce their moves to the SEC within the next year (goal is next summer)

So the GOR is gone? Have a link for that?

 

[nelsonmuntz]

Why does FSU need $300 million from private equity? Only if they are planning to buy the ACC network from ESPN and Raycom.

If they control the ACC network, then they control the media rights of their conference peers. They can say: free us from this grant of rights, or the ACC network is all FSU all the time, and your time slot is 4 am Monday morning.

And then they say: UNC, UVa, etc, you can go to B1G or SEC if you pay us $100 mn to buy out your GoR. It makes financial sense for the top ACC teams and the private equity groups get their money back.

I have to say, that would lead to an immensely entertaining negotiation.

There is not enough popcorn in the world for the spit show that PE owning any part of a college athletics department will become.

 

[billybud]

The GOR is still very much in play...one has never been legally contested but I suspect that will change.

The Texas legislature declared that Texas Tech was an arm of the state and thus had sovereign immunity...to thwart payment to Mike Leach's judgement.

 

[nelsonmuntz]

The GOR is still very much in play...one has never been legally contested but I suspect that will change.

The Texas legislature declared that Texas Tech was an arm of the state and thus had sovereign immunity...to thwart payment to Mike Leach's judgement.

The PE firm that plays any part in trying to get a team to illegally break a GOR would be on the hook for treble damages (tortious interference) so no one will do anything until FSU gets out of the GOR first. Good luck with that.

 

[FfldCntyFan]

I wonder if any of the decision makers at these schools understand how PE firms work.

Before they hand over a penny of the $300 million to FSU there will be thousands of hours devoted to how this investment will give the firm a desirable return (with the federal funds rate at 5.5% I imagine they'll be looking at a minimum return between 16%-18%) with every potential source of income listed in full detail.

My question: is this a loan or is FSU selling something to the PE firm?

If this is a loan, how does FSU pay the required return and the principal back (more of a concern if rates drop to where they were a couple years ago)?

If the PE firm is purchasing something, what is it that they are purchasing?

This could become quite dangerous for a not for profit, state run institution for higher education.

 

[FfldCntyFan]

The PE firm that plays any part in trying to get a team to illegally break a GOR would be on the hook for treble damages (tortious interference) so no one will do anything until FSU gets out of the GOR first. Good luck with that.

A PE firm won't try to break it. They'll work out a value to buyout of it, offer a lesser number to the ACC, negotiate to some agreement and then overcharge FSU for their trouble.

 

[billybud]

The PE firm that plays any part in trying to get a team to illegally break a GOR would be on the hook for treble damages (tortious interference) so no one will do anything until FSU gets out of the GOR first. Good luck with that.

Jeez...where did you go to law school ? If a PE is providing a loan, it won't illucidate that it specifically to be used to break a GOR...It will just provide the school the money...and that might make that possible.

A long, long stretch to Tortious Interference.

 

[JeepCSC]

Going Indy is not an option...unless you have a big indy contract like Notre Dame is pushing.

Indy is another word for non competitive in finances.

And this guy is a UNC radio guy....grain of salt.

Dan Wolken is a national guy.

 

[ctchamps]

Back in the old days of Jan 1 bowl games and voted on titles, I never imagined things would get this insane. I really miss being able to just watch games and not constantly hear about money.

Except the corruption that took place by local officials running those games was about money. Lots of it. What you didn’t have back then was the internet with its twenty four seven in your face exposure that you have today.

 

[billybud]

I was speaking of Northam

Dan Wolken is a national guy.

 

[JeepCSC]

But Wolken was the one who mentioned independence. Northam just reacted to it.

 

[billybud]

But Wolken was the one who mentioned independence. Northam just reacted to it.

And I noticed that...Count on UNC.

 

[JeepCSC]

Inside scoop from my boss and major UNC donor, expect UNC plus 1-3 other schools to announce their moves to the SEC within the next year (goal is next summer)

 

[goskis2018]

So the GOR is gone? Have a link for that?

No link, just what I know from a guy in the room tasked to make it happen.

The money is there and the four biggest brands ganging up together is going to bust the door open by force.

Idc if you believe me, this is happening. Too much money on the table

 

[ctchamps]

Just here to drop in and say, all of you who thought the ACC buy out was insurmountable can’t see the bigger picture. Bigger hurdle is going to be state govs (UNC leaving all of the other NC schools for dead as an example)

The coming Power 2 will have payouts that were unimaginable when the ACC signed their deal.

Inside scoop from my boss and major UNC donor, expect UNC plus 1-3 other schools to announce their moves to the SEC within the next year (goal is next summer)

I was going to speculate prior to this post that with with all the churning going on one of the B12, BIG or SEC has made contact with one or more of the resistant programs in the ACC to let them know if the conference votes to dissolve they have a more profitable landing place.

It will be that easy to get the votes to dissolve the conference.

 

[FfldCntyFan]

I was going to speculate prior to this post that with with all the churning going on one of the B12, BIG or SEC has made contact with one or more of the resistant programs in the ACC to let them know if the conference votes to dissolve they have a more profitable landing place.

It will be that easy to get the votes to dissolve the conference.

How many votes are needed and are you sure that anyone in the bottom half of the ACC would vote to dissolve?

 

[FfldCntyFan]

No link, just what I know from a guy in the room tasked to make it happen.

The money is there and the four biggest brands ganging up together is going to bust the door open by force.

Idc if you believe me, this is happening. Too much money on the table

Out of curiosity where is this money coming from and what will be required from the schools in return for this money?

 

[billybud]

How many votes are needed and are you sure that anyone in the bottom half of the ACC would vote to dissolve?

To dissolve the ACC as a North Carolina non profit...a majority vote.