(H.E. Eng. Khalid bin Abdulaziz Al-Falih - Minister of Investment, Saudi Arabia)
MESIF – Milan, KSA VIP Roundtable
On the 5th and 6th of September 2024 The Middle East Sports Investment Forum (MESIF) hosted an exclusive VIP roundtable in Milan, focusing on the significant sports investment opportunities in Saudi Arabia. The event brought together prominent industry figures, including representatives from the Ministry of Investment and the Ministry of Sport of Saudi Arabia, as well as CEOs of Inter Milan, AC Milan, and other high-level delegates. Discussions centered around the rapid development of the Saudi sports sector, particularly football, and how both local and international investors can capitalize on Saudi Arabia’s ambitious Vision 2030 goals.
Saudi Arabia has taken significant steps toward becoming a global sports powerhouse, from privatising sports clubs to hosting international sporting events. The Roshn Saudi League, with its acquisition of top international players and increased broadcasting rights, is one such example of Saudi Arabia’s commitment to enhancing its football ecosystem. The recent growth in sports infrastructure, elite performance, and mass participation reflects the Kingdom’s dedication to building a thriving sports economy.
(Basim K. Ibrahim, Sport Investment Director, Ministry of Investment, Saudi Arabia)
(Armando Mastrapasqua, General Manager, AIM Group)
Key Themes Discussed
1. Privatisation of Sports Clubs
One of the key highlights of the event was Saudi Arabia’s initiative to privatise its sports clubs, providing opportunities for private investors to take full ownership. This is part of a larger effort to modernise the football ecosystem and professionalise and commercialise the clubs. The clubs are moving toward adopting best practices seen globally, with lessons drawn from successful clubs such as Juventus, Inter Milan, AC Milan and others.
2. Revenue Generation Models
Attendees explored various revenue streams for clubs, including sponsorship deals, broadcasting rights, and fan engagement through innovative digital platforms. These strategies were discussed with an eye toward boosting the commercial value of Saudi football clubs and improving financial returns for investors.
3. Strategic Collaborations
The importance of collaboration between the public and private sectors was emphasised, with partnerships playing a pivotal role in driving sports growth in the Kingdom. The Ministry of Investment and Ministry of Sport have taken proactive measures to engage with global sports entities to foster long-term investments.
4. Building a Sustainable Sports Ecosystem
The roundtable also delved into the strategies needed to develop a sustainable sports ecosystem, focusing on talent development, infrastructure upgrades, and grassroots programs to foster the next generation of athletes. The discussions highlighted the necessity of building a strong foundation that supports elite performance while encouraging mass participation.
(Ahmed Abas, Director of MENA Sports Practice, EY Middle East)
(Dino Ruta Ph. D, SDA Bocconi School of Management, Professor of Leadership, Sports and Events Business, Director Sport and Entertainment Knowledge Centre)
Why Now Is the Time to Invest in Saudi Clubs
Saudi Arabia’s sports sector is undergoing a transformation, and football is at the heart of it. The Kingdom has a clearly defined roadmap for its sports industry, which aligns with Vision 2030. By privatising clubs and opening the market to foreign investors, Saudi Arabia is creating a fertile environment for business opportunities in the sports industry.
With increased investment in infrastructure, sponsorships, and broadcasting, the Saudi sports market is projected to grow from SAR 26.5 billion recorded in 2022 to SAR 124 billion by 2030. This presents a lucrative opportunity for investors looking to diversify their portfolios and engage with one of the fastest-growing sports markets in the world.
Additionally, the sports club sector is subsidised, with the Ministry of Sport continuing to provide grants to new club owners. These subsidies are tied to specific KPIs and requirements, ensuring that new investors receive financial support while contributing to the overall development and success of the Kingdom’s sports ecosystem. This government backing further de-risks investments and adds a strong incentive for foreign investors looking to capitalise on the rapid expansion of Saudi football.
(Bader Aljeraisy, Privatization Director, Saudi Arabia)
(Chris Lencheski, Co Founder & CEO/CHM, SKI Partners)
How to Acquire a Sport Club in Saudi Arabia
For those interested in taking part in Saudi Arabia’s football club privatisation process, The Ministry of Sport provide a clear and structured path to ownership. Below is a step-by-step guide:
1. Express Interest
Investors must first express their interest by reaching out to the National Centre for Privatisation & PPP at Sportsclubs@NCP.gov.sa. This initial step is crucial to formally begin the qualification process.
2. Qualification Submission
Once interest is registered, investors will be required submit the necessary qualifications by the 20th October 2024, which includes financial stability, ownership suitability, and other governance requirements.
3. Receive Request for Proposal
Upon successful qualification, investors will receive a Request for Proposal package from the Ministry of Sport. This package contains detailed information about the club and the terms of the acquisition as well as an access to a VDR of the club of interest, where all club information is kept.
4. Bidding and Negotiation
Investors will submit their bids (Financial & Technical), which are then reviewed by the relevant authorities. Following bid submission, negotiations are held to finalise the deal.
5. Transaction Closing
Once the bid is accepted, the final stage is closing the transaction. The investor will take ownership of the club, acquiring not just the team and intellectual property, optionally they can also acquire its infrastructure, intellectual property, and all other assets relating to the club.
6. Timeline
The entire process typically takes around 6-12 months. Throughout the process, investors are supported by the Ministry of Sport and the Ministry of Investment, ensuring a smooth transition into ownership.
(Giorgio Furlani, CEO, AC Milan), (Alessandro Antonello, CEO, Inter Milan)
Saudi Arabia is a rapidly expanding market, and investing in its football sector offers substantial growth potential. With support from government bodies and the Ministry of Investment, there has never been a better time to explore opportunities in Saudi football.
(Simon Hoppe, Global Partnerships Director, Two Circles / Juventus)
If you have any questions or for more information, please contact:
Authors:
Aleksander Georgiev, Business Development Director, MESIF
Bader Aljeraisy, Privatization Director, Saudi Arabia
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