The Saudi Ministry of Sports held an expanded conference on Monday to announce the details of the Sports Clubs Investment and Privatization Project, which was launched by Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince and Prime Minister.
Minister of Sports and Chairman of the Saudi Olympic and Paralympic Committee, Prince Abdulaziz bin Turki bin Faisal bin Abdulaziz, attended the press conference, which was held at King Abdullah sports city in Jeddah.
The conference also witnessed the presence of a number of leaders and senior officials of a number of development agencies, including the CEO of the National Center for Privatization (NCP), Muhannad Basudan; Public Investment Fund’s (PIF) Deputy Governor and Head of the General Administration of Investments in the Middle East and North Africa, Yazeed Al-Hamid; Executive Vice President of Human Resources and Corporate Services at Saudi Aramco, Nabeel A. Al-Jama; the CEO of Diriyah Gate Development Authority (DGDA), Jerry Inzerillo; the CEO of the Royal Commission for AlUla (RCU), Amr AlMadani; and the Managing Director of Sport at NEOM, Jan Paterson.
At the beginning of the conference, Prince Abdulaziz expressed his gratitude to the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz Al Saud, and Prince Mohammed bin Salman bin Abdulaziz Al Saud, Crown Prince and Prime Minister, for the sustained support and attention provided to all sectors, and the sports sector in particular.
Such support and attention have resulted in great qualitative leaps, said Prince Abdulaziz, indicating that the Crown Prince’s support for the sports sector enabled the launch of a number of key initiatives that paved the way for this historic project.
The Sports Minister revealed converting four clubs into companies, and transferring the ownership of these companies to development agencies after those agencies and companies have explored investment opportunities in the sports sector.
He indicated that the ownership of Al-Qadisiyah Club was transferred to Saudi Aramco, Diraiyah Club’s ownership was transferred to the DGDA, AlUla Club’s to the RCU, and the one of Suqoor Club to NEOM.
Moreover, the Minister announced the investment of the PIF in four Saudi clubs, by converting them into companies owned by the Fund, and a non-profit organization for each club, which are Al-Ittihad, Al-Ahli, Al-Nassr and Al-Hilal clubs.
Prince Abdulaziz also revealed the establishment of an investment fund for each of the eight club companies whose ownerships have been transferred, and depositing the value of the club in the investment fund, in exchange for transferring its ownership, with the aim of achieving sustainable returns for the benefit of the club company.
He pointed out that the ownership of Al-Ittihad, Al-Ahli, Al-Nassr and Al-Hilal club companies will be distributed according to specific percentages, as the PIF will have 75% of the ownership of each company, while the remaining part 25% will be owned by each non-profit organization, provided that these organizations include the current members of the General Assembly as well as the new members.
The Minister of Sports indicated that the election of the Board of Directors of the non-profit organization will be by the members of the General Assembly of the organization, and after the formation of the board, two members will be nominated for membership in the Board of Directors of the club company; One of them shall be the Chairman of the Board.
Accordingly, the Minister added, the Board of Directors of the club company will be composed of two members nominated by the members of the Board of Directors of the non-profit organization and five members nominated by the PIF.
He also announced the launch of a number of sports clubs for privatization, in coordination with the NCP, as clubs of various divisions will be selected to be offered to the private sector in the first phase, during the last quarter of 2023, based on criteria that will be announced during the offering period.
Minister of Sports stressed that the draft Clubs Support Strategy Project, including programs and initiatives, will continue to be worked on to serve all sports clubs, according to the mechanism in place, in order to ensure their continued governance and organization financially and administratively.
He concluded his speech by emphasizing the pivotal and important role of the private sector in supporting the sports sector and benefiting from the important and qualitative investment opportunities that the Sports Clubs Investment and Privatization Project will create.
The CEO of the NCP Basudan said the privatization system takes a new step in announcing the privatization of clubs, to enable sports clubs to seize the distinguished growth opportunities inside or outside the stadium and inject new investments in the sports sector.
The step, Basudan adds, also enhances the financial sustainability of clubs by establishing financially independent commercial entities that contribute to the development of their revenues and reinvestment in order to build a local sports economy that contributes to raising the quality of life, developing stadiums and providing exciting competition.
The PIF’s Deputy Governor and Head of the General Administration of Investments in the Middle East and North Africa expressed his excitement that the Fund is part of the qualitative shift in Saudi sports.
Al-Hamid considered the sports sector to be one of the 13 strategic sectors of the PIF, adding that such a historic step of the Sports Clubs Investment and Privatization Project comes in line with the Kingdom's efforts to empower and develop the sports sector in order to achieve the objectives of the Kingdom's Vision 2030.
