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The Qatar Investment Authority has taken a stake in the owner of Washington’s professional basketball and hockey teams, marking the first investment by a sovereign wealth fund in US sport.
The fund is paying $200mn for a 5 per cent stake in Monumental Sports and Entertainment in a deal that values the owner of NBA’s Washington Wizards, the WNBA’s Washington Mystics and the National Hockey League’s Washington Capitals at $4.05bn, according to two people familiar with the matter.
In recent years, Gulf states have ploughed billions of dollars into sport, from golf to tennis and football, partly to develop domestic tourism and entertainment sectors, but also in search of returns as the industry benefits from explosive growth in the value of media and broadcasting rights.
The investment from QIA, which has an estimated $450bn in assets, comes less than a year after the NBA amended its bylaws to allow sovereign wealth funds to invest in clubs.
Founded by former AOL vice chair Ted Leonsis, Monumental is also an assortment of esports teams, local television and radio networks.
“As one of the largest integrated sports and entertainment companies in the country, MSE’s platform provides unique opportunities and scalability for growth and partnerships,” the QIA said on Monday.
Qatar, one of the world’s biggest exporters of liquefied natural gas and one of its richest nations in per capita term, has invested heavily in sports over the past two decades, culminating in it hosting the football World Cup last year.
The Gulf state has also owned French football club Paris Saint-Germain since 2011 through its Qatar Sports Investments fund.
People familiar with the Monumental deal said that the QIA was taking a stake in the group as a financial transaction to gain exposure to a company with a diverse range of assets. The QIA will not gain board representation as part of the transaction, one of the people added.
Saudi Arabia’s Public Investment Fund, the kingdom’s $650bn sovereign wealth fund, has made waves across sport.
The fund led a consortium that bought English football club Newcastle United in 2021, and last month announced a framework deal to combine commercial interests with golf’s PGA Tour. The PIF is also in talks to invest in men’s professional tennis.