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Saudis, Grand Slams Seek To Invest Billions Into Tennis, Those Efforts Are Not Mutually Exclusive

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Saudis, Grand Slams Seek To Invest Billions Into Tennis, Those Efforts Are Not Mutually Exclusive

Professional tennis has received a pair of billion-dollar investment proposals in recent weeks.

Saudi Arabia’s Public Investment Fund (PIF) put one forth in March that would have pumped at least $1.3 billion into the men’s and women’s tours. It’s been reported the Saudis have since pulled the term sheet.

The PIF proposal came as the ATP and WTA waited on the Grand Slams’ pitch to fix the sport’s structural problems. Wimbledon, the U.S. Open, French Open, and Australian Open have since put forth a plan to align with 10 other tournaments and create a premium tour (think: Formula One).

Many reporters have suggested the PIF and Grand Slams are competing with one another, or that only one can ‘seize control over the sport’. They’re confused.

For starters, they’re comparing apples to oranges. The Saudi proposal was worth $1.3bn over a decade. The Slams’ pitch would, in theory, unlock an additional billion dollars in revenue annually.

The two sides’ agendas aren’t mutually exclusive, either. In fact, the players would benefit if the ATP and WTA proceeded with both groups.

It would mean more than $2bn worth of new money entering the sport.

For context, current revenues and investment in pro tennis are estimated to be between $2.5-$3bn.


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Outsiders see the civil war taking place in golf (see: PGA vs. LIV) and mistakenly assume the PIF, who is backing LIV, is now attempting a hostile takeover of tennis. And as a result, they view the Saudi proposal to be in direct competition with the Grand Slams’ vision for a new ‘top flight’.

But the two attempts to galvanize the sport are unrelated. 

The Saudis are “trying to be a new partner of global tennis in any shape or form,” Ahmad Nassar (executive director, Professional Tennis Players Association) said.

Much like they desire in soccer, cricket, and fight sports. Their proposal included the ability to host events, like the WTA Tour Finals (to be held in Riyadh from ’24-‘26), to sponsor the men’s ranking and select tournaments (announced in February), and to acquire a license for a new 1000 tournament.

The proposed investment would have also gone towards merging the tours’ commercial operations and an increase in the player prize pool.

“You add all those incremental pieces up, it’s substantial-hundreds of millions of dollars [if not more than a billion] of value,” Nassar said. “But it’s over 10 years.”

In other words, it would not be a transformative investment.

By contrast, the Grand Slams (who are being represented by USTA CEO Lewis Sherr and Tennis Australia chairwoman Jayne Hrdlicka) want to reform the sport in a way that makes it more compelling for fans and commercial partners, and would lead to billions of dollars in incremental revenue annually.

“They’re trying to fix pro tennis and create a more sustainable structure [for] the long-term,” Nassar said.

As it stands, the Slams command perhaps as much as 95% of fan mindshare. 

“When you talk about tennis, [those eight weeks are] really all anybody cares about,” one high level insider said. 

The proposed revamp would theoretically enable the sport to develop more consistent storylines and narratives across the other 30+ weeks of the season.

“Everybody acknowledges tennis as a sport is leaving a lot of money on the table because it doesn’t sell an NFL/NBA-style media package,” Nassar said. “If it could sell a package of TV rights, four Grand Slams and 10 other high-profile events throughout the year, that would be a massive unlock.”

Remember, unlike soccer, tennis’ global talent is unified. The best 80 men and 80 women participate in nearly all the major tournaments.

Details of how the money would be divvied up between the tournaments (the Slams currently generate ~65% of all tennis revenues) and/or who would own the combined premium tour still must be worked out. 

As does who will underwrite its formation and growth. 

Private equity isn’t likely.

The ATP and WTA “don’t want somebody who is going to need to flip [their stake] at some point,” the insider said.

And the WTA took an investment from CVC, which went public last week, last year. Finding a second PE fund willing to pay the markup CVC would want on the price it paid seems improbable.

Blue-ribbon strategic capital (think: Larry Ellison who owns Indian Wells) and/or sovereign funds are the most likely investors.

But that does not necessarily mean the PIF exclusively (think: Qatar’s QIA, Mubadala, Singapore’s GIC), and it certainly does not suggest the Saudis intend to buy the Grand Slams, the 10 other tournaments, and/or tennis’ best players. 

Skeptics may have their doubts. From a resource standpoint, presumably they could.

However, few of the tournaments are for sale (IMG is rumored to be shopping the Miami and Madrid Opens). And more importantly, the Saudis do not view their foray into golf to date as a success story or template to replicate in other sports. 

The ongoing battle between LIV and the PGA has dragged both properties down. The final round of the Masters drew just 9.59 million viewers (-22% YoY).

And remember, the PIF really just wanted to invest in the DP World Tour and host some high-level golf events. It only went down the LIV route with Greg Norman & Co. after the PGA turned it down.

Golf’s civil war seems likely to end with a merger of sorts giving the Saudis a seat at the table (and events on home soil), not control over the sport.

The ATP and WTA players aren’t hung up on who invests in the sport. They just want more prize money, a calendar that makes sense, and for tennis to be elevated in sports’ global value chain.

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