Many speculate that the Pac-12 is not actually worth the $5B it is valuing itself atGETTY IMAGES
The "Pac-12 NewCo" plan, which would see private investors owning 10% equity in the newly formed entity in exchange for a $500M investment, would lead potential investors to ask "tough questions," which could be "bad news for the Pac-12," according to John Canzano of the Portland OREGONIAN. The "Pac-12 NewCo" plan is based on a "dreamy $5 billion valuation of the media enterprise," but it is "not likely worth anything close to that." Endeavour Capital is "exactly the kind of private-equity firm that the Pac-12 should be interested in partnering with." Endeavour co-Founder John von Schlegell "doesn’t blame the conference for exploring private investment." However, he said that before the Pac-12 "gets a nickel from a sophisticated investment firm, conference headquarters should expect a deep drill into their world." Pac-12 Commissioner Larry Scott’s contract ends in June '22 and the Pac-12′s lease on its S.F. HQ "expires later that same year." The conference’s media contract "runs out" in '24. Von Schlegell said, "Their time-frame fits private equity. Private equity fits for a three, four, five, six-year window." Pac-12 VP/Public Affairs and Head of Communications Andrew Walker in a statement said the conference regularly benchmarks expenses "against peer group conferences and networks as part of sound fiscal hygiene." But Canzano noted the Pac-12 "doesn’t have a real peer as an athletic conference." It "postures like a Power Five conference member, but doesn’t perform like one in major sports." The Pac-12 operation is "ripe for a comprehensive examination" (Portland OREGONIAN, 2/27).
