Dubai: Two of the world’s richest sovereign wealth funds are interested in buying minority stakes in National Basketball Association teams, according to people familiar with the matter.
Executives at Abu Dhabi’s Mubadala Investment and Qatar Investment Authority have expressed their interest in NBA ownership and are actively hunting for a possible match, said the people, who requested anonymity as the discussions are private.
Representatives for Mubadala and QIA declined to comment.
Mubadala and QIA’s interest is preliminary and there is no certainty that either will buy a stake in an NBA team, the people said.
In the most recent sale, billionaire Mat Ishbia agreed last year to buy more than 50 per cent in the Phoenix Suns in a record deal that valued the club at $4 billion.S
The prospect of NBA ownership became possible late last year after the league’s Board of Governors approved a rule change to allow sovereign wealth funds to buy as much as a 20 per cent stake in teams. Previously, such funds could only do so through indirect exposure.
“The NBA Board of Governors recently decided to allow direct, passive investments in NBA teams by institutional investors,” NBA spokesman Mike Bass said in a statement. “All such investments are subject to league review and NBA Board approval.”
New York Knicks
One target could be the New York Knicks. The team is owned by Madison Square Garden Sports Corp., which is controlled by the Dolan family. MSGS’s biggest equity shareholder is investment firm Silver Lake Management, which has strong ties with Abu Dhabi, and is a co-investor in Premier League giant Manchester City.
Speaking on an earnings call this month, MSGS president David Hopkinson said the company was open to selling a minority stake in the Knicks.
Any international deal for an NBA team would face significant scrutiny and likely require a lengthy due diligence process before securing league approval.
Gulf states' ambition
The talks underscore the ambitions of Gulf states to use windfalls from recent high energy prices to buy into the world’s most prestigious sports leagues.
Gulf countries have been on a spending spree for marquee sports teams and events as their coffers have swelled. Saudi Arabia and Abu Dhabi each own an English Premier League football team, while Qatar holds stakes in Paris Saint-Germain and Portuguese team SC Braga.
Qatar spent an estimated $300 billion to host the 2022 FIFA World Cup, and this year the region will host four F1 races. Qatari investors are set to make an offer for Manchester United, Bloomberg News reported this week, citing unidentified people familiar with the plan.
In October, Abu Dhabi hosted the first-ever NBA preseason games in the Middle East.
