PIF dive deep into world of football



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Saud Arabia Public Investment Fond to put GBP2bn in soccer Image: Newcastle United

The Public Investment Fund (PIF) of Saudi Arabia has committed £2 billion to new long-term football sponsorship deals outside of the Premier League team Newcastle United F.C. (UK) in 2022.

‘Newcastle World’ stated that the PIF, who own 80 percent of ‘The Magpies’, has invested heavily since becoming the club’s majority owners in October last year, most notably spending £210 million during the last two transfer windows.

Riyadh (Saudi Arabia)-based the Public Investment Fund (PIF) is the sovereign wealth fund of Saudi Arabia. It is among the largest sovereign wealth funds in the world with total estimated assets of $620 billion (£492 billion).

The Newcastle United Football Club is an English professional football club based in Newcastle upon Tyne, England (UK) that plays in the Premier League – the top flight of English football. The club was founded in 1892 by the merger of Newcastle East End and Newcastle West End.

The St James’ Park is a football stadium in Newcastle upon Tyne, England. It is the home of the Premier League club Newcastle United F.C. With a seating capacity of 52,305 seats, it is the eighth largest football stadium in England (UK).

‘Newcastle World’ further stated that the PIF was created in 1971 for the purpose of investing funds on behalf of the Government of Saudi Arabia. The wealth fund has been controlled by the Crown Prince Mohammed bin Salman, Saudi Arabia’s de facto ruler since 2015.

Although building United into a world powerhouse tops PIF’s priority list, the sovereign wealth fund wants to establish further connections in the world’s most popular sport.

The PIF stated in its most recent financial statement that it had entered into sponsorship agreements “with multiple football clubs amounting to SAR8.75bn (£2.1bn)” in the first eight months of this year.

Rather than be directly named as a sponsor, the PIF has put forward companies it owns. For example, Roshn, a real estate firm owned by PIF, has a five-year agreement to sponsor the Saudi Football League.

Meanwhile, Newcastle is on the lookout for a new main shirt sponsor for the next season after negotiating an early exit for their FUN88 deal. There is an expectation it will be a Saudi-connected company.

In June, Noon – an online retailer based in the Middle East – became the club’s official sleeve sponsor on all of its 2022-2023 kits.

Said Dale Aitchison, Head of Commercial Partnerships at Newcastle United, “noon.com is a hugely successful and influential brand in the Middle East and we are very pleased to team up to offer supporters in the region with new ways to engage with the club. One way we can achieve that is by creating a fast, efficient and effective way for fans in the region to order official Newcastle United merchandise, and we are delighted fans can utilize noon.com to proudly wear their kits for the new season.”

Income from sponsorship and other commercial deals will boost Newcastle’s spending power in the transfer market in line with Financial Fair Play.

The Union of European Football Associations (UEFA) Financial Fair Play Regulations (FFP) are a set of regulations established to prevent professional football clubs spending more than they earn in the pursuit of success, and in doing so not getting into financial problems which might threaten their long-term survival.

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