Former Utah alum and NBA executive Dave Checketts isn’t a fan of Utah’s historic private equity deal with Otro Capital.
Checketts described 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 discussion about what types of deals Checketts might be interested in striking with his sports investment fund Cynosure Checketts Sports Capital. He started by mentioning basketball and golf, and quickly added college sports, though he said: “College sports has got to settle its way a little bit before you invest.”
Checketts suggested he wouldn’t approach investments in the way that Otro Capital did with Utah.
“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 said. “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.”
The Utah-Otro Capital was approved unanimously by the university board in December; however, parties are still finalizing the long-form agreements which have not yet been fully executed and signed, sources told FOS.
When the deal is signed, however, it will be considered the first of its kind in college sports. It would require Utah to spin off its athletic department assets, forming a separate 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.
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, giving the university the option to repurchase its shares in certain circumstances.
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?” (When asked whether he has made contributions to Utah’s NIL and revenue-sharing efforts, Checketts declined to comment.)
Both the University of Utah and Otro Capital declined to comment when reached by FOS.
