Two of the world’s richest sovereign wealth funds are interested in buying minority stakes in teams from the nbaaccording to people familiar with the matter.
executives of Mubadala Investment Co. and Qatar Investment Authority have expressed interest in owning an NBA property and are actively looking for something that meets their expectations, said the people, who requested anonymity as the discussions are private.
Representatives for Mubadala and the QIA declined to comment. An NBA spokesman did not respond in time for publication.
The interest from Mubadala and QIA is preliminary and there is no certainty that either will buy a stake in an NBA team, the people said.
The NBA is one of the most profitable leagues in the world and the value of its franchises has skyrocketed in recent years. In the most recent sale, the billionaire mat ishbia agreed last year to acquire a stake of more than 50% of the phoenix suns, a record deal that valued the club at $4 billion.
The prospect of taking a stake in the NBA became possible late last year after the league’s board of governors approved a rule change to allow sovereign wealth funds to buy up to a 20% stake in teams. Previously, such funds could only do so through indirect exposure.
One of the teams in the crosshairs could be the knicks from New York. The team is owned by Madison Square Garden Sports Corp., which is controlled by the Dolan family. MSGS’s largest equity shareholder is investment firm Silver Lake Management, which has strong ties to Abu Dhabi, and is a co-investor in Premier League giant Manchester City.
On an earnings call this month, the president of msgs, david hopkinsonsaid the company was open to selling a minority stake in the Knicks.
Any international deal for an NBA team would face significant scrutiny and would likely require a lengthy due diligence process before gaining league approval.
The governments behind many of the Gulf sovereign wealth funds have been criticized by international organizations for human rights violations ranging from their treatment of workers to anti-LGBTQ laws.
The talks highlight the ambitions of Gulf states to use windfall profits from high energy prices to participate in the world’s most prestigious sports leagues. Teams are perceived as a potentially profitable investment and may offer autocratic governments the opportunity to launder their reputations through so-called sports laundering.
Gulf countries have been investing heavily in major sporting events and equipment. Saudi Arabia and Abu Dhabi each have a soccer team from the premier league England, while Qatar has shares in the Paris Saint-Germain and the portuguese team SC Braga.
Qatar invested approximately US$300 billion to host the FIFA World Cup in 2022, and this year four F1 races will be held in the region. Qatari investors reportedly about to make an offer for the Manchester United PlcBloomberg News reported this week, citing unidentified people familiar with the plan.
the sheikh Tamim bin Hamad Al Thanithe ruling emir of Qatar, and Khaldoon Al Mubarakthe chief executive of Mubadala and adviser to the Abu Dhabi royal family, are basketball fans, according to the people.
Source: Gestion
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