A Closer Look At Saudi Arabia's Multi-Billion Dollar Global Sports Investment Strategy

The sports world was left in shock on June 6 with the unexpected announcement of a merger between the PGA Tour and the European Tour, in partnership with Saudi Arabia's Public Investment Fund (PIF), which had already supported the LIV Tour.

Saudi Arabia's interest in sports can be traced back to 2016 when it launched its Saudi Vision 2030 program, aiming to diversify its economic investments under the leadership of Crown Prince Mohammed bin Salman.

With the Saudi Arabian Oil Company (Saudi Aramco) being the world's largest oil supplier and state-owned, it generated a staggering $161.1 billion in profits in 2022 alone.

However, Saudi Arabia has faced severe international criticism, especially from the United States, due to its involvement in the tragic 9/11 terrorist attack and the murder of journalist Jamal Khashoggi in 2018.

These incidents added to the existing concerns over the country's human rights violations and state-sponsored terrorism around the world.

Saudi Arabia's Investments in Sports

Golf

The Saudi-backed LIV Golf emerged in 2022, presenting the first significant competition to the PGA Tour.

Although the exact amount invested by the PIF remains undisclosed, various reports have highlighted substantial sums offered to entice PGA players.

Phil Mickelson, for instance, was reportedly offered $200 million. Notable players who declined LIV's offers include

Tiger Woods, allegedly offered up to $800 million, Rory McIlroy, reportedly offered $500 million, and Hideki Matsuyama, who received a $300 million offer. The extent of the PIF's future contributions to the league after merging with the PGA and DP Tour is yet to be determined.

Soccer

In late 2021, the PIF acquired the Premier League club Newcastle United for approximately $408 million.

It has also successfully recruited soccer stars Cristiano Ronaldo and Karim Benzema, both signing contracts worth over $100 million annually.

Before Inter Miami snagged Lionel Messi, the Saudis tried luring him in with a $440 million per year offer.

WWE

In 2018, the Saudi fund and WWE entered a 10-year agreement worth $1 billion. As part of the deal, two major WWE events per year would take place in Saudi Arabia, starting with the "Greatest Royal Rumble" in April 2018.

Formula One (F1)

In 2021, Saudi Arabia hosted its inaugural Formula One race, known as the Saudi Arabian Grand Prix, as part of a 10-year, $650 million deal.

Additionally, Saudi Aramco secured a 10-year, $450 million sponsorship agreement with the motorsport league, effectively making the overall Saudi deal with F1 worth over $1 billion for the next decade.

According to Bloomberg, there were reports of Saudi Arabia offering $20 billion in an attempt to acquire the entire Formula One league from Liberty Media, which acquired it for $4.4 billion in 2017.

Boxing

Since 2019, Saudi Arabia has reportedly paid around $100 million to host two fights featuring Anthony Joshua. Rumors suggest that the country may host more significant "super fights" as early as next year.

E-Sports

Saudi Arabia acquired ESL Gaming for $1 billion and merged it with FaceIt, which it had purchased for $500 million, forming the ESL FaceIt Group.

These investments highlight Saudi Arabia's strategy of utilizing sports for economic gain while also facing accusations of "sportswashing," using the success and glamor of sports to conceal human rights issues.

The full extent of the impact of these investments and their implications on the sports landscape remains to be seen.

If you enjoyed reading this, subscribe HERE for more stories in your inbox every morning!