Saudi Arabia into sports shopping spree
Saudi Arabia is embracing sports in a big way and sees racing, boxing and soccer as a means to enhance its image. The kingdom did not have a huge footprint on the world sporting map. But, of late, the staging of sporting events extraordinaire has marked a sharp turnaround for the oil-rich country.
Taking a stellar role in holding big-ticket events is the Crown Prince of Saudi Arabia, Prince Mohammed bin Salman, with the bigger vision to modernize the economy. He wants Saudi Arabia to look beyond oil and allow Western-style entertainment and concerts – something which has long been denied to the Saudis – and, in the process, generate much-needed jobs and lure investors.
Asian Games 2030
Qatar and Saudi Arabia has entered the fray for the hosting rights of the Asian Games in 2030. This information was given by the Olympic Council of Asia (OCA) recently.
The OCA has said it had received bids from Doha and Riyadh, the capital cities of the two neighboring Gulf countries.
“The OCA is delighted to receive two strong bids for our Asian Games in 2030,” said Sheikh Ahmad Al-Fahad al-Sabah, the body’s President.
“It shows the trust and confidence in the Olympic Movement in Asia and further enhances our reputation of hosting world-class sporting events on a major scale,” the OCA chief further stated.
The host city will be decided at the OCA General Assembly meeting to be held in Sanya, China, on November 29 this year.
“With these two bids (read Qatar and Saudi Arabia) for the 2030 Asian Games, we now have stability and continuity in our sports movement for the next decade,” Sheikh Ahmad averred.
The 15th version of the Asian Games was hosted by Qatar in 2006, but Saudi Arabia has never played host to an OCA multisport event.
AFC Asian Cup 2027
Saudi Arabia has proffered to play host to the 2027 Asian Football Confederation (AFC) Asian Cup national team soccer tournament. The Middle Eastern country looks to add major soccer tournament to its event hosting slate.
The Asian Football Confederation (AFC), the continental soccer body, started inviting bids to stage the 19th edition of the quadrennial event after declaring in December last year that it planned to appoint a host as soon as possible to allow for more preparation time.
Saudi Arabia’s bid, which was submitted by the Saudi Arabian Football Federation (SAFF), has the blessings of the kingdom’s General Sports Authority (GSA), which has been the driving force behind the entire initiative to bring more major sporting events to the Middle Eastern country in recent times.
The SAFF said that its proposal brings to the fore the international sporting events that have been held in Saudi Arabia over the past two years, which include Formula E races, European Tour golf tournaments and boxing’s world heavyweight title rematch between Anthony Joshua and Andy Ruiz Jr.
Commenting on the Saudi bid for the 2027 Asian Cup, SAFF President Yasser Al-Mesiha remarked, “We have a rich record and great legacy of the Asian achievements of teams and clubs, as this artistic heritage will be completed by hosting the biggest championship in the continent. We hope to present the bright reality of Saudi Arabia in hosting, with the unlimited support of our wise leadership, to continue the journey of hosting many international events in various fields in the Kingdom of Saudi Arabia.”
Saudi Arabia has won the continental title three times but has proffered to host the event for the first time. The winning bid is expected to be announced by AFC early next year.
Picking up Live Nations stake
Live Nation has witnessed a 4.2 per cent bump in its share price after Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), purchased a passive 5.7 per cent stake in the company.
Live Nation is an American events promoter and venue operator based in Beverly Hills, California, in US.
A Securities and Exchange Commission (SEC) filing stated that the Saudi fund acquired a total of 12.3 million shares valued at approximately $500m. That makes PIF the live entertainment giant’s third-largest shareholder, with Liberty Media, which owns a 33 per cent stake, the largest.
As of April 16, 2020, the fund’s stake in Live Nation rose above five percent, according to the filing. Shares were up to around the $39 mark in early trading on April 27.
The SEC filing also contained that the securities “were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect.”
With COVID-19 bane making the staging of live events nigh impossible, Live Nation is suffering colossal losses, with more than 30,000 concerts and summer festivals being canceled or postponed across the world. The entertainment giant has seen its share price nosedive almost 50 percent since February as its business has come to a virtual standstill due to coronavirus causing havoc worldwide.
Earlier this month, the company was forced to make cost-reduction plans, including Live Nation Chief Executive Michael Rapino doing without his $3m annual salary.
A series of financial moves has been unlocked by the live entertainment giant to shield its concert business amidst the coronavirus-enforced shutdown – a new $120m credit facility and a ‘cost-reduction program,’ which includes Rapino’s 100 percent pay cut.
According to an SEC filing, Live Nation’s other top-level officials will also face up to a 50 percent cut in salaries, with President Joe Berchtold now taking home $650,000, down from $1.3m.
The PIF is the sovereign wealth fund of Saudi Arabia and enjoys financial muscle – it is counted among the largest investment groups in the world with total estimated assets of $320bn. It was founded with the objective of investing funds on behalf of the Government of Saudi Arabia.
The aforementioned step taken by PIF is the latest in a series of investments made in struggling companies that are bleeding white due to the COVID-19 pandemic, like cruise line operator Carnival, or whose shares have been hit due to crude prices hitting rock bottom, like European oil companies Royal Dutch Shell and Total. The sovereign fund has also agreed to buy a majority stake in English Premier League football club Newcastle United for £300m.
Newcastle United deal
The £300 million deal to take over English professional football club Newcastle United is edging closer which will see the Saudi Arabian Public Investment Fund (PIF) pick up an 80 percent stake in the club.
The owner of the football club – billionaire Mike Ashley – is mulling on an agreement to sell the Premier League club – a decision which has not gone down well with fans.
Ashley, according to documents filed on the UK’s corporate registry, has agreed to sell the club for a reported $380 million to a consortium led by Saudi Arabia’s Government investment fund (read PIF), with some funding from UK billionaire brothers David and Simon Reuben.
With Saudia Arabia’s Minister for Sports Abdulaziz bin Turki Al Saud following Newcastle United through his official account (@AbdulazizTF), enough hint has been thrown that the deal is inching closer.
And the Minister for Sports is a young blood – a 36-year-old Prince and former race driver entrusted with running the Ministry of Sports.
Newcastle United Football Club is an English professional football club based in Newcastle upon Tyne in UK. Tyne and Wear, that plays in the Premier League, the top flight of English football. Founded in 1892 by the merger of Newcastle East End and Newcastle West End, the team plays its home matches at St. James’ Park.
There was little indication last year that the deal is set to be struck. Now, the buyout is being talked about openly in Saudi Arabia with the powers that be in the country following the club on social media and linking the State to Newcastle.
The Saudi Arabian PIF is on a major spending spree since the coronavirus onslaught. Cases in point – it has infused nearly £400million in Live Nation.
It is another sign that PIF – who own 80 percent of United Newcastle when if the deal brokered with Mike Ashley is confirmed in the coming days – is serious on doing business and is loosening its purse strings.
The PIF, which is set to invest nearly more than £200million to buy an 80 percent stake in Newcastle United as soon as Premier League checks are completed, is sending out strong messages that it will spend heavily while prices are depressed.
After buying a stake in Carnival Cruises, they’ve now bought a stake in the world’s largest live entertainment firm (Live Nation), which owns Ticketmaster. Saudi Arabia is looking to bring more live events to the kingdom as part of their plan to divest their dependence on oil revenue.
On Monday a filing with the US Securities and Exchange Commission (SEC) showed PIF has bought 12,337,569 shares. They invested nearly £400million to buy a 5.7 percent stake in the world’s biggest entertainment firm and they are now the third largest shareholder.
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