Qatar’s bold bet on US sport
Qatar has made no secret of its ambitions in global sport. It owns French football club Paris Saint-Germain, last year hosted the men’s World Cup, and in 2019 the World Athletics Championships — both rescheduled to bend summer sporting traditions to the realities of the Gulf state climate.
This week, however, it revealed one of its boldest bets yet: a $200mn investment by the Qatar Investment Authority into the Washington, DC-based sports and media portfolio, Monumental Sports and Entertainment. Beyond taking a 5 per cent stake in the company — which owns a trio of pro basketball and ice hockey teams — the investment marks the first such injection by a sovereign wealth fund into professional sports in the US.
The milestone reflects the rapid transformation of the American sporting sector, which only four years ago opened the floodgates to institutional investment. Since 2019, three of the Big Four professional leagues have amended bylaws to permit private capital stakes, and late last year, the National Basketball Association became the first to greenlight sovereign wealth investments.
But why the QIA, why MSE, and why now? The sports firm, valued at $4bn, was founded by former America Online executive Ted Leonsis and today owns basketball’s Washington Wizards and Mystics, ice hockey’s Washington Capitals, an assortment of esports teams and local sports channels, as well as the district’s Capital One Arena.
The group has received less of a fanfare than other notable US billionaire sports empires. Unlike Fenway Sports Group, Kroenke Sports and Entertainment, and Harris Blitzer Sports and Entertainment, MSE is entirely concentrated in one city, and Washington’s largely itinerant workforce makes it unique among major US sports markets.
Still, Leonsis and Co. are keen on expansion: they have bid for Major League Baseball’s Washington Nationals, though the sale is reportedly on pause through the ongoing season. And while the QIA does not receive a board seat or any operational control through their investment, a financial injection into an institution in the US capital may ultimately be a stroke of diplomacy.
Washington’s hometown paper, the Jeff Bezos-owned Post, has expressed scepticism about the investment, calling it “sportswashing” and noting the gulf between Monumental’s own embrace of LGBTQ inclusivity and the fact that homosexuality is outlawed in Qatar. Further, it was the Post’s own columnist, Jamal Khashoggi, who was dismembered in 2018 at a consulate of Saudi Arabia, Qatar’s rival in gulf state sports investments.
As both Qatar and Saudi Arabia pursue ever more ambitious sports investments, the reception in US of the MSE investment (and in turn, the firm’s performance), will be worth watching closely.