The proprietor of the professional basketball and hockey teams in Washington has received an investment from the Qatar Investment Authority (QIA). This marks the initial foray of a sovereign wealth fund into the realm of American sports.
In a transaction that values Monumental Sports and Entertainment, the proprietor of the Washington Wizards, Washington Mystics, and Washington Capitals franchises, at $4.05 billion, the QIA has acquired a 5 percent ownership stake for $200 million. Two sources familiar with the situation confirmed the details of the deal, according to a report published in the Financial Times.
Over the past few years, Gulf nations have invested considerable sums of money in various sports, such as golf, tennis, and football. These investments serve the dual purpose of developing domestic tourism and entertainment sectors, as well as seeking profitable returns, given the sports industry’s significant expansion in media and broadcasting rights’ value.
Less than a year after the NBA modified its bylaws to enable sovereign wealth funds to invest in clubs, the QIA has invested in Monumental Sports and Entertainment. The QIA, which is believed to have assets worth $450 billion, made the investment.
Over the past 20 years, Qatar has invested considerably in sports, with a focus on hosting major events. The country, which is among the world’s largest exporters of liquefied natural gas (LNG) and one of the wealthiest countries per capita, recently hosted the football World Cup.
QIA, a fund owned by the Gulf state, has possessed Paris Saint-Germain (PSG), a French football team, since 2011.
PIF’s sports investments
Saudi Arabia’s Public Investment Fund (PIF), a sovereign wealth fund worth $650 billion, has made significant investments in sports. In 2021, the fund led a consortium that acquired the English football club Newcastle United, and more recently, it announced a framework agreement to merge commercial interests with the PGA Tour in golf. The PIF is also currently in discussions regarding investing in men’s professional tennis.
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