Re: Valuation vs SEC shouldn't really be question

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Posted by ButterBall Devil on November 29, 18 at 09:29:16:

In Reply to: Valuation vs SEC shouldn't really be question posted by mDEVIL! on November 28, 18 at 19:53:14:

I understand your perspective, but the valuation issue - as far as the member schools go - is really based on a capitalization method - IMO.

There is no point to build a network, and then sell it, unless there will be a new arrangement (post sale) for continued cash flow to the member schools - e.g., revert to the SEC current model.

So - back to the benchmark issue; I think the other conferences are relevant for peer group comparison. I do agree that PAC fans and SEC fans are dramatically different, and the PAC likely will never enjoy the same "fan derived revenues". But I do think that the SEC model should be the goal.

Because we lack a "way back machine" (see: Professor Peabody, and his pet boy Sherman), we will never have a definitive answer to the question - would the PAC had been better off to simply license its "content", rather than build a network (and fail to get a carriage deal with Direct, agree to stupid time slots for games, locate with excessively high occupancy costs, etc.)?

It might be interesting to know how the analysis was performed, and who did it. With the benefit of hindsight, I think it has been a big "fail".

It might also be interesting to see if there might be a potential purchaser for the network - but again, if I were that buyer, I would not pay a valuation based on what I think I will do with the network. Rather I will pay the valuation based on current results to the owners. If there could be a bidding war among qualified buyers, perhaps the cap rate could be squeezed.

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