The Big Ten's private capital plan has been paused.
The conference's quest to strike a $2.4 billion deal with a California pension fund was officially paused on Monday while it waits for "unity" among the 18 schools in the league. While the deal would have infused significant amounts of money into Big Ten athletic departments,both Michigan and USC had opposed the deal.
UC Investments is the group behind the deal, and it is tied to the pension fund of the University of California system. In exchange for the $2.4 billion, UC Investments would have received a 10% stake in Big Ten Enterprises — a proposed new entity that would house all of the league's media rights and sponsorship deals.
"As we have continued to evaluate this opportunity over the past five months, we remain convinced that the unity of the 18 Big Ten university members is key to the success of Big Ten Enterprises," UC Investments said in a statement, in part. "We also recognize that some member universities need more time to assess the benefits of their participation. UC Investments likewise requires some additional time to complete our due diligence as recent developments unfold and we continue to engage with the conference."
The deal with the Big Ten would have infused millions of dollars to schools up front, with each school receiving an average of $135 million. Several schools and programs are in need of extra money due to increased operating costs, among other things. The Big Ten is currently in a $7 billion media rights deal that runs through 2030, too.
The conference and 16 schools were apparently on board with the plan, though both USC and Michigan were against it. Big Ten executives were working on a plan earlier this month to move forward without both USC and Michigan, potentially even scheduling a vote to adopt it without them, according toYahoo Sports' Ross Dellenger.
Some Michigan trustees described the deal as a "payday loan" and a "bail out" for Big Ten schools that had mismanaged their finances. USC, according to Dellenger, is concerned that some league members would receive a larger share than they would.
It's unclear how long this pause in the private capital plan will last, or if Michigan and USC will come around. For now, though, it appears the two schools have gotten their wish.
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