NewsmakersJune 16, 2023

Fore: Wealthy Saudi Fund, Already Muscling Into Golf, Steps Up in Soccer, Too

Having bought a U.K. football club and lured major players, the kingdom fortifies its homegrown teams financially.

Reported by Larry Light

First there’s golf; now soccer. Saudi Arabia’s sovereign wealth fund is taking over four football clubs—all Ted Lasso fans know we are not talking about the gridiron here—in the kingdom. This comes amid more noticeable efforts to become a big name in professional golf and to broaden the Saudi economic reach beyond energy.

The nation’s Public Investment Fund will have a 75% stake in each of four teams now owned by the Saudi government, according to a Reuters report quoting SPA, the state news agency. The teams are Al-Ittihad, Al-Hilal, Al-Nassr and Al-Ahli—the first three already in the top-tier, 18-team Saudi Professional League, and Al-Ahli about to rejoin after winning the second-level Saudi First Division in May.

The plan from the nation’s de facto leader, Crown Prince Mohammed bin Salman, had been hinted at as far back as 2017. It intends to harness the nation’s investment fund to super-charge the chosen clubs, per Reuters. The kingdom estimates that the Saudi Professional League will expand its annual income fourfold by 2030, to $480 million. The PIF could not be reached for comment.

Far better known than the local soccer deal is the acquisition victory of PIF-backed LIV Golf. The 2-year-old Saudi pro golf organization last week announced a merger agreement (subject to an investigation from the U.S. Department of Justice) with the PGA Tour, which had been resisting such a union—until the U.S.-based circuit evidently realized that deep-pocketed LIV was enjoying too much success enticing high-end talent. The PIF also has made big investments in WWE (wrestling) and Formula 1 (racing cars).

On the soccer front, the PIF—which has $650 billion in assets, according to the Sovereign Wealth Fund Institute—in 2021 bought Newcastle United, a member of England’s Premier League, for a reported $420 million, according to Sportico. What’s more, the Al-Nassr team in January signed marquee player Cristiano Ronaldo for a reported yearly salary of more than $100 million, which would make him the highest paid athlete in the world. Other Saudi teams followed with enticing pay packages for name performers.

None of this is to say that the oil-rich kingdom’s riches prevail every time. Example: Argentine superstar Lionel Messi, already paid by the kingdom as a tourism ambassador and a personal rival of Ronaldo’s for the title of world’s best player, nevertheless raised eyebrows this week by rejecting a Saudi offer and announcing his intent to sign with Inter Miami, part of Major League Soccer in the U.S.

Meanwhile, Saudi Arabia had signed on to sponsor this summer’s Women’s World Cup before significant backlash from prominent women’s players and joint host countries Australia and New Zealand, over the kingdom’s restriction of women’s rights, forced an about-face.

The kingdom is expected to make an energetic bid to host the men’s World Cup in 2030 or 2034, possibly in partnership with Greece and Egypt. Further, the kingdom will host the considerably smaller Club World Cup this December; even before the PIF’s new investment, Al-Hilal reached the 2022 Club World Cup final in Morocco, losing 5 to 3 to Spanish superpower Real Madrid. One of Real Madrid’s goals was scored by French forward Karim Benzema, who has already agreed to join a new club for 2023-24: Saudi Arabia’s Al-Ittihad.

Whatever the worldwide reaction, Saudi investment in sports seems set to continue.