SALT LAKE CITY – The University of Utah has announced a plan to help the athletics department generate new revenue streams, in part through a first-of-its-kind partnership with a private equity firm.
The school announced Tuesday the formation of Utah Brands & Entertainment LLC, which will be owned by the university's foundation. It is promoted as a way to build the school's brand and improve sports programs. The new company could generate around $500 million in capital, according to Yahoo Sports.
In a joint message, school President Taylor Randall and Athletic Director Mark Harlan detailed the preliminary work and said the university will transfer some of its revenue-generating operations from athletics and ancillary services to Utah Brands & Entertainment.
Through the new entity, the school will build its brand. That will include oversight of corporate sponsorships, ticket sales, event-related revenue, and university trademarks and licenses across campus.
The new business model has the support of the university's board of directors and the deal could close early next year. The school added that it plans to partner with prominent university supporters along with Otro Capital, a private equity firm with expertise in sports and entertainment.
The inclusion of private equity is a first for college sports and follows seismic changes in the industry, with players able to make money off their name, image and likeness and receive direct payments from schools.
“Importantly, the university does not sell parts of our athletics department, cede operational control to a third party, or relinquish control of any facility,” Randall and Harlan wrote to the Utah community. “Decisions regarding athletics, coaching, scheduling, operations, student-athlete care and other athletic matters will remain solely in the hands of the athletics department… The university foundation will appoint the majority of Utah Brands & Entertainment's board of directors, and the board will be chaired by the director of athletics.”
Randall and Harlan's message said that “as the world of college athletics continues to change, this step positions us to remain competitive, innovative and firmly aligned with our academic mission, while continuing to unite our community through the power of Utah athletics.”
