The wealth fund sports investment is now entering major American sports.
The Qatar Investment Authority is buying a minority stake in Monumental Sports & Entertainment, the parent company of the NBA’s Washington Wizards, NHL’s Washington Capitals, and WNBA’s Washington Mystics, according to Sportico.
QIA is buying 5% of the company for a valuation of about $4.05 billion.
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This deal marks the first time a sovereign wealth fund has invested in major American team sports. The NBA allowed team ownership to be spread to private firms in 2020, then opened it up to funds such as sovereign wealth and university endowments in late 2022.
This has come as a result of the exponential appreciation of sports franchises in recent years with NBA franchises worth as much as $7.6 billion as of last year.
Funds are still not allowed to have a majority stake of a franchise as single fund stake is capped at 20%. A team can only sell up to 30% of its total stake to multiple private equity firms and other funds.
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NBA Commissioner Adam Silver spoke on “The Dan Patrick Show” earlier this month about the Saudis and their potential entry into the NBA, but said there had been no discussions.
Though he did try to reiterate that the influx of investments from funds shouldn’t affect how teams are run.
“We allow funds to invest in teams, but not to control teams, not to have influence over teams,” Silver said.
