Saudi Arabia, long on the lookout for a global platform to showcase its sporting ambitions, is nearing the end of its search.
The Persian Gulf kingdom is close to acquiring up to a 10 percent stake in DAZN, a sports-only network that has been privately funded by the billionaire businessman Len Blavatnik, according to three people familiar with the discussions who spoke on the condition of anonymity because no deal has been announced. Saudi Arabia has in recent years moved from a standing start to become the biggest investor across the sports industry — buying into an array of leagues, teams and stars to upend the economics of many sports.
The deal, which will lead Saudi Arabia, through a unit of its sovereign wealth fund, to spend more than a billion dollars, has been under discussion for at least a year, according to the three people, as the cash-hemorrhaging business and the Saudis forged a closer link.
The network, which is available as a streaming platform and on cable networks worldwide, is already the biggest partner for Saudi Arabia’s growing portfolio of sports properties, including its soccer league, tennis championships and top-tier boxing events.
Sports have been a key area for Saudi Arabia ever since its de facto leader, Crown Prince Mohammed bin Salman, announced plans in 2016 to pivot the kingdom away from its reliance on oil by diversifying its economy amid simultaneous efforts to liberalize the conservative Muslim nation.
Those efforts have poured billions of dollars into sports, providing opportunities for businesses like DAZN, which is poised to break even after years of losses that total more than $5 billion. As part of its investment, Saudi Arabia will get a partner with a large footprint across multiple continents. It will not only provide a platform for live sports and other sports-based programming, but also act as a billboard for Saudi Arabia. The wealth fund; Surj Sports Investment, the vehicle being used for the purchase; and DAZN declined to comment.
One of the plans, according to the people familiar with the discussions, is for DAZN, which is largely a subscription service, to broadcast content from Saudi Arabia for free. Such a move would follow DAZN’s announcement last month that it would broadcast FIFA’s Club World Cup for free next summer.
An investor like Saudi Arabia is unlike most market participants, said Gill Hind, director of TV at Enders Analysis, a research firm focusing on the media, entertainment and telecoms sectors. For the kingdom, financial success matters less than the increased visibility for the sports properties it owns, including its top soccer league.
“It’s a very different proposition for the Saudis,” Mr. Hind said. “They’re doing it for different reasons than would be typical for other investors.”
The Saudi Arabian investment into DAZN follows months of speculation. Late last year, the investment fund denied that it wanted to own a stake in the broadcaster.
DAZN recently announced that it was paying about $1 billion to broadcast a new World Cup for clubs owned by soccer’s governing body, FIFA. Several other networks either declined to bid or offered multiples less than DAZN for the event, which will take place in the United States this summer. Saudi Arabia has cultivated a close relationship with FIFA and, in particular, its president, Gianni Infantino. Shortly after DAZN’s deal was announced, Saudi Arabia was awarded the rights to host the FIFA men’s World Cup in 2034.
Saudi officials have also been involved in talks for years about acquiring a stake in Qatar’s BeIN Media Group, owner of another of the world’s largest sports networks. Those talks have taken place against the backdrop of an ongoing legal battle between Saudi Arabia and Qatar, which is seeking billions of dollars in damages after accusing the larger gulf kingdom of orchestrating a yearslong piracy campaign against the network.
“BeIn Media Group is considering a number of strategic options,” the company said in a statement, echoing comments it first made in 2022. The dispute first flared during a vicious disagreement between Qatar and its regional neighbors in 2017, dragging on despite a normalization of relations with Saudi Arabia.
DAZN, based in London, is owned by the Moscow-raised Mr. Blavatnik. A citizen of both the United States and Britain, he has spent years accumulating sports rights but has also incurred mammoth financial losses during the process. DAZN’s most recent set of accounts is listed as overdue, according to Companies House, Britain’s companies registry.
Those losses haven’t stopped the company from spending. In addition to being one of the top rights holders in markets where it operates, it has also been acquiring other businesses. In December it bought Foxtel in Australia from Rupert Murdoch’s News Corp in a deal worth about $2.1 billion.