The University of Utah has inked college athletics’ first private equity deal, partnering with Otro Capital to create Crimson Brand Partners.
According to Fox 13, the deal will bring the Utes into a new era of college athletics with an estimated $500 million investment. The university hopes the partnership will modernize its athletics department and 19 varsity teams, including women’s and Olympic sports, while allowing the university to maintain ownership of the athletics department.
The agreement will establish a plan for revenue growth, expanded commercial opportunities, and increasing the financial support for Utah athletics.
“This new company puts the University of Utah at the forefront of developing creative and strategic solutions to the financial challenges facing college athletics programs across the country,” said University of Utah president Taylor Randall.
Related: Most Big 12 Schools Decline New $30M Line of Credit
Crimson Brand Partners will begin operating — under the supervision of the university foundation — on July 1, just two months after the Big 12 opened the door for private equity deals within its conference.
In May, the Big 12 Conference partnered with Red Bird Capital to offer every team a $30 million line of credit, but nearly every team within the conference turned down this opportunity. During those early days of the deal, Utah was one of the only schools not to publicly decline the funds.
At that time, 83% of AB Today readers indicated in a poll that they did not agree with private equity entering the realm of college athletics.
Despite fans and onlookers having reservations about the set up, University of Utah athletics director, Mark Harlan said, “There’s more risks of not doing anything based on the climate that we’re in and the rising costs for you know player compensation and operation. We’re comfortable that our risks are covered.”
