At least one mega-booster at Utah has zero interest in his alma mater’s historic private-equity deal with Otro Capital. Businessman and NBA executive Dave Checketts explained the deal to Front Office Sports as the Utes selling off “their future” during a recent episode of Portfolio Players.
The comments came during a conversation regarding what types of deals Checketts might be interested in striking with his sports investment fund Cynosure Checketts Sports Capital. He started by saying basketball and golf, and quickly added college sports, before adding, “College sports has got to settle its way a little bit before you invest.”
But when it comes to how Utah and Otro Capital came to their deal, Checketts said, “It’s one thing to do what the University of Utah has done—kind of sell off their sports program because they want a better stadium and they want a basketball building, and they want it right now. He added, “So they kind of sold off their future. That’s different than the kind of investments we are talking about where college sports, if it’s possible, to make a big change.”
Otro Capital Details
In December, the University of Utah finalized a groundbreaking deal with private equity firm Otro Capital that could bring in at least $500 million.
Here’s the setup. Utah is creating a new for-profit entity LLC called Utah Brands & Entertainment. That entity, now being referred to as Crimson Brand Partners, would be majority owned by the university, though Otro Capital would take a minority stake. As part of a buy-in, Otro Capital would provide a capital infusion. All the business arms of the athletic department, ticketing, concessions, sponsorships, licensing, and even media rights, would move under this new umbrella. Otro Capital would buy in as a minority partner, while the University, through its foundation, keeps controlling interest and governance. So it’s not a full sale or a handover, but it is a serious financial play that would immediately give Utah more cash on hand than just about any athletic department in the country.
However, parties are still finalizing the long-form agreements which have not yet been fully executed and signed, sources told Front Office Sports.
In addition, Otro Capital executives would help the athletic department, as well as university at large, with business and revenue-maximization opportunities. The new entity will “manage and grow key revenue streams across the Athletics Department and the university. This includes overseeing, optimizing and enhancing the fan experience, corporate sponsorships, ticketing, event-related revenues and campus-wide university trademarks and licensing,” a university explainer reads.
The deal does have a buyback clause, which allows the university the option to repurchase its shares in certain circumstances.
Checketts on a Super Conference
Checketts then endorsed the idea of a super league in college football. “I’ve said, this whole idea—which has been floated many times—of a ‘super conference’ with divisions and relegation, I think, is a sensational idea. I’d be really, really interested if that’s the road they go down. I have no reason to believe they’ll go there, but I prefer that rather than letting the NILs and everything else to turn it into just a minor league. I mean, how can you watch the NCAA tournament and want anything different than that?”
