Saudi Arabia’s sports ambitions have taken a significant step forward with the recent announcement of the PGA Tour’s plans to merge commercial operations with LIV Golf, a Saudi-funded rival. This move signifies the kingdom’s growing interest in sports and raises the possibility of further investments in major US professional leagues like the NFL and NBA.
While US professional sports leagues are highly lucrative, with the NFL generating $18 billion in revenue last year, the Saudis are not solely after short-term profits. These investments are part of Crown Prince Mohammed bin Salman’s Vision 2030 initiative, which aims to diversify Saudi Arabia’s economy and reduce its dependence on oil.
Saudi Arabia has already made substantial investments in sports and entertainment. The country hosts a Formula One race, WWE shows, and the world’s richest horse race. The sovereign wealth fund also financed the acquisition of the Premier League’s Newcastle United and aims to attract high-profile footballers to the Saudi Pro League with lucrative wage offers.
There are indications that the kingdom is expanding its sports empire in the US. Documents obtained in 2019 revealed that Saudi Arabia sought the assistance of an international consulting firm to lobby leading US sports commissioners and bodies. Prince Abdulaziz bin Turki Al Saud, the kingdom’s minister of sports, and other Saudi lobbyists held meetings with representatives from MLB, NBA, MLS, and NHL. Princess Reema Bandar al-Saud, the current Saudi ambassador to the US, even met with Kobe Bryant in 2018 to discuss basketball development in Saudi Arabia.
The NBA appears to be a likely target for Saudi investment. Basketball is popular in Saudi Arabia, and the NBA’s global reach aligns with Saudi Arabia’s goals of expanding its soft power. The NBA’s board of governors also recently approved the acquisition of minority stakes in teams by sovereign wealth funds, pensions, and endowments, opening the door for potential Saudi ownership.
MLB, which also has a soft salary cap system, could be another target for Saudi investment. The league eased its ownership rules to allow investment funds to acquire minority stakes in multiple teams. Additionally, MLB granted its franchises the commercial rights to sign sponsorship deals in foreign markets, a potential avenue for partnerships with Saudi Arabia.
However, the NFL, with its sole-ownership structure and hard salary cap, presents significant challenges for Saudi Arabia. The economic limitations and the league’s traditional image might hinder potential partnerships or acquisitions. Nonetheless, the ever-growing wealth of Saudi Arabia cannot be disregarded, and the landscape could change in the future.
While Saudi Arabia’s sports ambitions continue to expand, there are obstacles that could limit its American ambitions. US regulators, such as the Securities and Exchange Commission and the Department of Justice’s anti-trust enforcers, may scrutinize potential deals involving Saudi investment. Senator Ron Wyden, the US Senate’s finance chair, has already expressed concerns about the PGA/LIV Golf merger and plans to investigate the deal’s implications.
As the merger progresses, it remains to be seen if US regulators will take steps to protect other major sports leagues. The strained relations between the US and Saudi Arabia in recent years may also influence the outcome. Nevertheless, Saudi Arabia’s rapid ascent in the world of sports suggests that other US leagues could be enticed by the kingdom’s seemingly limitless resources.
[email protected]
Sorry, the comment form is closed at this time.
No posts were found.
We just hit over 10,000 Followers on LinkedIn ⚽️ 🏉🏀 🙏🏼 #thankyou #ministryofsport https://t.co/hlzOzKRtYy 3 days ago
Meet Keynote Panelist Sarah Kelly is a Professor and Head of the QUT Graduate School of Business , Deputy Chair of… https://t.co/JN7y6T1b3b 3 days ago
Copyright © | Ministry of Sport | All Rights Reserved.
Already Member? Login Here