Saudi Arabia’s Public Investment Fund (PIF) has discussed a possible investment of £60m into four Premiership Rugby Clubs.
According to The Telegraph, PIF has reportedly met with Gloucester, Leicester Tigers, Northampton Saints and Newcastle Falcons, intending to acquire a substantial stake in these clubs.
Initially, PIF was presented with the opportunity to obtain a stake in Gloucester, but found the idea of investing in multiple clubs more attractive. The potential investment could see PIF securing stadium naming rights and establishing a rugby academy in Saudi Arabia.
Although discussions have started, there is a huge risk that talks could fall through due to huge regulatory hurdles put in place by the Rugby Football Union (RFU) and European Professional Club Rugby (EPCR), who have restrictions on club ownership changes and investments.
The RFU allows ownership changes of up to 10% without requiring consent, whereas larger investments – like PIF’s potential acquisition – may face regulatory hurdles. Similarly, EPCR regulations prohibit any single entity from owning more than a 20% stake in two teams.
However, this isn’t likely to intimidate the Saudi-backed investment fund from backing out of discussions due to past experiences when acquiring clubs in other sports.
In 2021, PIF acquired an 80% stake in Newcastle United in a deal worth around £300m. The takeover process lasted 18 months and faced interventions from the governments of both the United Kingdom and Saudi Arabia, despite reportedly being ready to back out of talks at one point.
Since the takeover of Newcastle, the football team has progressed on and off the pitch, reaching the Champions League, which has been accelerated by the sheer amount that PIF has injected into the club.
Without a doubt, ethical questions will be asked by fans and regulators in rugby, but with every new acquisition by the investment fund, it becomes harder to find reasons why leagues shouldn’t welcome its investment.
Regulators of Premiership Rugby have not yet commented on the talks.