Major League Soccer could be the next US sports league to allow sovereign wealth funds to invest in its teams.
The league’s board members will discuss the topic at a meeting next week in Washington, MLS commissioner Don Garber said Thursday at the Allen & Co. Sun Valley Conference. The commissioner said the board is following in the footsteps of other US sports leagues, including hockey and basketball.
“The NHL and NBA have looked at having sovereign funds and pension funds,” Garber said in a Bloomberg TV interview. “The MLS is looking at the same thing.”
Sovereign wealth funds have recently been investing more in professional sports across the world. The Saudis, through the country’s Public Investment Fund, are owners of LIV Golf and Newcastle United FC. The PIF has also considered buying another top soccer club in Europe, Bloomberg reported Thursday.
Crown Prince Mohammed bin Salman has made sports a key part of his strategy to diversify the economy, improve the kingdom’s image internationally and catalyse growth in tourism. Saudi Arabia is considering a joint bid to host the 2030 FIFA World Cup, a tournament most recently held in neighboring Qatar. It has also earmarked billions to expand in everything from golf to Formula 1 to boxing bouts.
The influx of Middle Eastern capital is now finding its way to US sports. The National Basketball Association recently accepted its first sovereign wealth-fund investment. The Qatar Investment Authority bought a 5% stake in Monumental Sports & Entertainment, the owner of the Washington Wizards, Mystics and Capitals. The deal valued the MSE at $4.05 billion, according to Sportico.
Though the MLS is now considering working with sovereign wealth funds as a partner, it’s also encountered them as a rival. Earlier this year, the US league lured global soccer superstar Lionel Messi away from both Barcelona FC and the Saudi Arabian club Al-Hilal, which is funded by PIF.
Al-Hilal offered the 36-year-old player a deal that would have earned him around $400 million annually, according to news reports. Had he accepted, he would have joined other huge soccer figures, including Cristiano Ronaldo and Karim Benzema, who are earning hundreds of millions of dollars playing in the country’s club.
“Having him say Major League Soccer is his league of choice, not Saudi Arabia, not FC Barcelona, it adds just a level of excitement and credibility and just enormous enthusiasm behind our league,” Garber said of Messi.
The Argentine soccer legend could make as much as $150 million over two and a half years, according to Sportico. Garber confirmed Messi’s deal includes a stake in the club and revenue-sharing agreements with Apple Inc. and Adidas AG
Garber said the MLS probably won’t sign another deal as large as the one that clinched Messi’s hiring, but he’s open to it if the right situation comes up.
“The likelihood of ever having a situation with a player, where they get an opportunity to participate in equity, is probably something we’ll never do again,” Garber said. “There was only one David Beckham. There is only one Lionel Messi.”
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