The fund is buying about 5 percent of the Washington sports team as part of a $4 billion deal, the Associated Press and Bloomberg reported.
Qatar’s sovereign wealth fund is buying about 5 percent of the parent company of the NBA’s Washington Wizards, the NHL’s Washington Capitals and the WNBA’s Washington Mystics as part of a $4 billion deal, news reports said.
Bloomberg News and The Associated Press cited sources on condition of anonymity because the deal between the Qatar Investment Authority and Monumental Sports and Entertainment has not been officially announced.
The Qatari government is believed to be investing in US professional sports for the first time. Sportico first reported the transaction, saying it was the first time a sovereign wealth fund had bought ownership of an American team.
This is not Qatar’s first major foray into major sports. The Middle Eastern country hosted the soccer World Cup for the first time last year, with ticket and hospitality sales helping FIFA reach record revenue levels.
Qatar Sports Investments, a subsidiary of the state-run fund, has owned majority control of French football club Paris Saint-Germain since 2011. The same group agreed to buy a 22 percent stake in Portuguese club Braga in October
A top US market, even as a minority partner, is a further expansion of Qatar’s reach into the world of sports.
The league’s board of governors decided in November to allow “passive, non-controlling, institutional investors, including university endowments, foreign and domestic pension funds and sovereign wealth funds, to make minority investments in NBA teams,” NBA spokesman Mike Bass said. subject to Policy guidelines adopted at that time”. All investments eligible for this bill require league review and NBA board approval
“The NBA Board is currently reviewing the potential investment by QIA [Qatar Investment Authority] at Monumental Sports & Entertainment, parent company of the Washington Wizards, among other sports properties,” Bass said. “According to the policy, if approved, QIA will have a passive, minority investment in the team, with no involvement in its operations or decision-making.”
NHL Deputy Commissioner Bill Daley said the league has already approved the investment.
An expert on such transactions said sports are part of Qatar’s nation-branding and public diplomacy strategy and the move is consistent with that strategy.
“Part of that strategy involves buying, sponsoring or buying equity in international sports organizations in Western markets, particularly in central cities,” said Yoav Dubinsky, instructor of sports business at the University of Oregon’s Lundquist College of Business.
“From a political perspective, this means further legitimizing Qatar as a trading partner in the West, including at the heart of American politics.”
Dubinsky added that the size of the stake would limit Qatar’s influence over the teams, unlike Paris Saint-Germain’s control. This fits the NBA’s definition of a passive, minority investment.
Neighboring Saudi Arabia has also moved into US sports. Its sovereign wealth fund, which funded the upstart LIV Golf Series, has agreed to a business partnership with the PGA Tour.
Ted Leonsis, owner of the Capitals since 1999 and majority owner of the Wizards since 2010, is the founder, managing partner and CEO of Monumental. The company lists 20 other partners on its website, including Lauren Powell Jobs and Washington Nationals owner Mark Lerner.
Monumental owns the G League’s Capital City Go-Go’s and Washington’s Capital One Arena, and recently acquired the media outlet known as NBC Sports Washington, now known as Monumental Sports Network.