Private equity eyes college sports as players secure payday

• Each school will be allowed to share up to $20.5 million in revenue, mostly with football players. That cap is expected to rise annually.
• The settlement also provides $2.8 billion in restitution to former student-athletes, and allows schools to create mechanisms to limit the influence of outside boosters and "collectives" — although questions remain about the effectiveness and enforcement of such oversight.
• For more context, check out our Axios BFD conversation last fall with NCAA president Charlie Baker.

The big picture: The settlement gives both schools and investors much more economic clarity, which could lead to dealmaking.

• Particularly in better understanding the haves and have-nots, as only a relatively small handful of colleges are likely to spend up to the $20.5 million limit.
• Expect a lot of private investment to help finance new facilities and develop luxe fan experiences. Similar to an expanded investment partnership announced yesterday — albeit negotiated prior to the settlement approval — between sports and entertainment agency Elevate, Velocity Capital Management, and the Texas Permanent School Fund.

Yes, but: Media rights is among the biggest revenue drivers for college sports, and most of that is negotiated at the conference level.

The bottom line: The NCAA settlement isn't a gamechanger for private equity, but it does move the yardsticks.