Photo Credit: https://baumgartner.house.gov/
On Monday, October 6th, Representative Michael Baumgartner (R-Wa-5) introduced a bill that would amend the Higher Education Act of 1965 to prohibit certain private-equity, sovereign wealth fund, and hedge fund agreements involving intercollegiate athletics.[1] This comes after a string of headlines within the past year and a half involving rumors of private equity and sovereign wealth investment in college sports.
Over the summer, the Big12 considered a deal from RedBird Capital, but the deal ultimately fell through.[2] Meanwhile, the Boise State athletic director stated that the department has been actively considering private capital as a means of investment and will most likely have a deal in place by the end of the year.[3]
Most recently, the Big Ten announced a nearly $2.4 billion private capital deal. Despite earlier reports, the Big Ten Commissioner insists that the deal is not a “private-equity arrangement” (as they are partnering with the University of California’s pension fund), and that any private capital partner would be a not-for-profit entity. The deal still needs the approval of all 18 member schools, which could be a problem considering Michigan and USC are not on board with the plan.[4]
As for sovereign wealth funds, the Saudi-backed Public Investment Fund (“the PIF”) has been active in the sports industry, with college sports being their newest target. Last week it was announced that the PIF was one of three entities that bought out Electronic Arts, the makers of popular video games, including the College Football game. As EA has NIL deals with many college football players to use their likenesses in the game, the deal raised questions about whether the NCAA, states, or the federal government would intervene in such deals that would essentially see collegiate athletes accept payments from the PIF.
This proposed bill aims to answer some of the concerns raised by these incidents by prohibiting deals between athletic departments or conferences with such financial institutions. The seven-page draft of the bill titled “Protect College Sports from Private Equity and Foreign Influence Act” (the PROTECT Act) would amend the Higher Education Act of 1965 by prohibiting schools or conferences from selling ownership stakes or transferring revenues to sovereign wealth funds, private equity funds, or hedge funds. This would also include any outside entities affiliated with the school or conference that were created to spin off assets like media rights or real estate. The bill would also prohibit any deal that would grant control to such a fund over athletic decisions, branding, scheduling, personnel, or student participation.[5]
One of the reasons given for the proposed bill is that public institutions of higher learning are financed and supported by taxpayers, and therefore they have a “heightened obligation to ensure that institutional assets—including intercollegiate athletics programs and facilities—are managed for public benefit and student welfare rather than private enrichment.”[6] Whether this reasoning will hold up against any potential future challenges should the bill be passed remains to be seen, however it is worth following as more schools and conferences enter negotiations for private capital.
[1] https://www.congress.gov/bill/119th-congress/house-bill/5693/text?s=1&r=11
[2] https://frontofficesports.com/new-bill-aims-to-prohibit-athletic-department-conference-private-equity-deals/
[3] https://frontofficesports.com/boise-state-expects-private-equity-investment-within-the-next-six-months/
[4] https://www.sportsbusinessjournal.com/Articles/2025/10/16/big-ten-commish-clarifies-leagues-exploration-into-outside-funding/?issueId=COLGFGMOZRGUNGKWPAVIJ6DXNQ
[5] https://frontofficesports.com/new-bill-aims-to-prohibit-athletic-department-conference-private-equity-deals/
[6] https://www.congress.gov/bill/119th-congress/house-bill/5693/text
Stacy Walker is a third-year law student at the University at Buffalo School of Law. Her areas of interest lie at the intersection of sports and corporate transactions, with prior research done on private equity investments in youth sports and professional stadium development projects.