Florida State University has been working with JPMorgan as it explores options to bring in funding from institutional investors, according to a person familiar with the matter.
The discussions have been ongoing in recent months, and Sixth Street Partners has expressed interest as an investor, the person said.
It’s unclear if the funding would be specifically for FSU’s athletic department or other parts of the university, although the university’s president reportedly told its Board of Trustees this week that they would have to seriously consider exiting the Atlantic Coast Conference division of the NCAA if the conference’s revenue distribution model didn’t change.
The discussions with potential equity investors are not tied to FSU’s potential push to leave the conference, according to the person familiar with the matter.
Sportico earlier reported that FSU was working with JPMorgan and that Sixth Street was part of the discussions.
Both JPMorgan and Sixth Street declined to comment. Representatives for FSU and the NCAA didn’t immediately respond to CNBC’s request for comment.
It’s uncommon for public universities to take funding from institutional investors.
In 2019, the Pac-12 Conference had expressed interest in selling a stake in its media rights to private equity firms, but later didn’t move forward with it.
“That effort fell apart, mainly because it was a challenge to mesh private investors with the potential media rights for public schools,” said sports media consultant Lee Berke.
“With FSU, we’re only talking about one public school, but the challenges associated with the private investment still apply,” Berke said. “The potential investors may want a relatively quick and predictable return on their investment, but it may take years for FSU to extricate itself out of its grant of rights and strike a new, substantially larger media deal with the ACC or another conference.”
While other NCAA divisions such as the Big Ten and Southeastern Conference recently signed lucrative media rights deals, the ACC has been locked into an agreement with ESPN that runs until 2036.
Media rights deals are often a major source of revenue for teams and leagues in both professional and collegiate sports.
The ACC’s revenue distribution model has recently changed in a way that rewards those who are more successful when it comes to football and basketball. FSU has been vocal in pushing for a change to this model so it would instead reward schools that generate higher TV revenue.
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