Saudi Investment Fund: A Global Reach And Ownership

Saudi Arabia's Public Investment Fund, or PIF, is an active investor in public and private markets, both domestically and internationally. The fund, established in 1971, has a mandate to help deliver Crown Prince Mohammed bin Salman's Vision 2030 plan to diversify the kingdom's economy away from oil and create private sector jobs. PIF's holdings include stakes in companies such as Lucid, Activision Blizzard, Electronic Arts, Uber, and Live Nation. The fund has also invested in giga-projects such as the $500 billion NEOM, a futuristic linear smart city in Saudi Arabia. With assets under management surpassing $700 billion, PIF is one of the largest sovereign wealth funds in the world.

Investments in gaming and entertainment companies

Saudi Arabia has been investing billions in recent years to become a global gaming hub. The country's Public Investment Fund (PIF), valued at $700 billion, has been making moves to transform the kingdom into a leading player in the gaming and esports sector.

The PIF's subsidiary, Savvy Games Group, has been instrumental in this effort, with a focus on developing a strong gaming ecosystem in Saudi Arabia, nurturing local talent, and attracting global expertise. Savvy Games Group is led by CEO Brian Ward, a former executive at prominent gaming companies, and has received backing from the PIF to the tune of $37.8 billion to $39 billion.

The group has made several strategic acquisitions, including the purchase of mobile game developer Scopely for $4.9 billion, and the merger of ESL, the largest esports operator, with FACEIT to form EFG, a leading global esports entity. Additionally, Savvy Games Group has acquired Vindex, a data and technology provider, and a minority stake in VSPO, a Chinese esports tournament operator. These moves strengthen their position in the esports industry and enhance their ability to host major competitions.

The Saudi investment fund has also invested in several prominent gaming companies, including Nintendo, Take-Two, EA, and Activision Blizzard. These minority investments give the kingdom significant influence in some of the industry's most profitable enterprises.

The kingdom's ambitious plan, aligned with its Vision 2030, aims to develop 30 competitive games and establish Saudi Arabia as a global gaming hub by 2030. The country's youthful population, advanced digital infrastructure, and strategic investments position it well to lead the global gaming and esports industry.

The investments in the gaming and entertainment sector are part of Saudi Arabia's broader strategy to diversify its economy away from oil and gas, which currently make up a significant portion of its GDP. By investing in sectors such as gaming, tourism, entertainment, and technology, the kingdom aims to foster innovation, create jobs, and stimulate economic growth.

Golf and other giga projects

Saudi Arabia's Public Investment Fund (PIF) has been involved in several golf-related ventures and other giga-projects as part of its Vision 2030 plan to diversify the country's economy away from oil.

In 2023, the PIF made headlines for its involvement in the startup golf tour, LIV Golf, which lured major golfers with the promise of massive winnings, leading to a legal conflict with the PGA Tour. However, in June 2023, the two entities announced plans to merge, with the PIF investing over $1 billion in a new commercial entity controlled by the PGA Tour. This agreement shocked the golf world and raised questions about the influence of the Saudi government in American sports, given the PIF is the primary funder of LIV Golf.

Another notable golf-related investment by the PIF is its £305 million ($414.8 million) takeover of English soccer club Newcastle United, bringing Portuguese football star Cristiano Ronaldo to the club Al Nassr, which is backed by a subsidiary of PIF.

In addition to its golf ventures, the PIF has several other giga-projects in the works, including:

• NEOM: A $500 billion project described as the "land of the future," NEOM will be nearly 33 times the size of New York City and will feature cognitive cities, ports, research centres, entertainment venues, and tourist destinations. It aims to operate entirely on renewable energy and is expected to welcome one million visitors by 2025 and five million by 2030.
• Qiddiya: A multibillion-dollar entertainment destination in Riyadh, Qiddiya is set to become the world's largest entertainment city, surpassing Walt Disney World in Florida. It will offer over 400 facilities, including theme parks, water parks, a sports city, shopping outlets, a performing arts theatre, and a motorsport facility.
• Red Sea Project: Led by Red Sea Global (RSG), this project focuses on luxury, sustainability, and innovation. It involves developing 50 resorts along the Red Sea coast by 2030, each committed to environmental protection. The first visitors are expected in 2023.
• Amaala: While not classified as a giga-project, Amaala is one of the flagship Vision 2030 projects. It is a luxury development focused on wellness, with a projected completion date of 2027. It will feature over 3,000 hotel rooms, 900 residential properties, and various retail, dining, and wellness facilities.
• Diriyah: Confirmed as the PIF's fifth giga-project, Diriyah is a culture and lifestyle destination located on the edge of Riyadh. It includes At-Turaif, a historical district and UNESCO World Heritage Site. The project will offer cultural and educational attractions, hotels, museums, and retail areas.

These giga-projects are designed to stimulate the economy, generate high financial returns, and contribute to the diversification of Saudi Arabia's economy.

Domestic companies, including Saudi Telecom and Saudi National Bank

The Saudi Investment Fund, or PIF, has a portfolio of high-quality domestic, regional, and international investments across sectors, geographies, and asset classes. The fund holds significant stakes in domestic companies, including Saudi Telecom and Saudi National Bank.

Saudi Telecom, also known as the Saudi Telecom Company (STC), is a leading telecommunications company in Saudi Arabia. It is one of the largest companies in the Middle East and North Africa region, with a market capitalisation of over $50 billion. The PIF holds a significant stake in STC, which constitutes a third of the fund's domestic holdings. STC has been a key player in the Kingdom's digital transformation and has expanded its services to include cloud computing, cybersecurity, and digital solutions.

Saudi National Bank, also known as SNB or AlAhli Bank, is one of the largest financial institutions in the Middle East. With a market capitalisation of over $50 billion, it is a prominent player in the Saudi banking sector. The PIF holds a substantial stake in SNB, which is also part of the fund's domestic holdings. SNB has a strong presence in corporate and investment banking, offering a range of financial services to individuals, businesses, and government entities.

In addition to these holdings, the PIF has also invested in other domestic sectors, including entertainment, leisure, sports, food and agriculture, transport, and utilities. The fund aims to drive strategic and sustainable diversification in line with Saudi Vision 2030, supporting the growth of the private sector and creating job opportunities for Saudi citizens.

The PIF's domestic investments play a crucial role in shaping the future of the Saudi economy, fostering innovation, and diversifying the country's sources of income. By investing in key sectors, the fund contributes to the development of the local economy and enables domestic companies to compete regionally and internationally.

Foreign companies, including Uber and Activision Blizzard

Saudi Arabia's Public Investment Fund (PIF) has been actively investing in foreign companies, including Uber and Activision Blizzard. In 2016, the PIF made a significant investment in Uber, acquiring a 5% stake in the company for $3.5 billion. This investment was part of the fund's strategy to bolster its resources and invest in foreign companies.

The PIF has also developed an interest in the gaming industry, with notable investments in Activision Blizzard, a leading American video game company. In 2021, the fund increased its stake in Activision Blizzard by 13.3%, resulting in a total of 37.9 million shares worth $3.3 billion. This move aligns with the PIF's broader strategy of diversifying Saudi Arabia's economy away from oil and gas.

In addition to Activision Blizzard, the PIF has invested in other prominent gaming companies such as Electronic Arts (EA), Take-Two Interactive, and Capcom. These investments in the gaming industry are not isolated incidents but rather a deliberate strategy, as games contribute a disproportionately large part of the PIF's portfolio, amounting to over 21% of its investments.

The PIF's investments in foreign companies like Uber and Activision Blizzard reflect its mandate to invest in new sectors and drive economic transformation in Saudi Arabia. These moves have attracted attention due to the fund's close ties to the Saudi government and the country's controversial human rights record.

Developing new industries, such as electric vehicles

The Saudi Public Investment Fund, or PIF, has a mandate to help deliver Crown Prince Mohammed bin Salman's Vision 2030 plan to diversify the kingdom's oil-dependent economy and create private sector jobs for its 32 million citizens. In 2022, a fifth of all PIF assets were targeted at developing new industries, including electric vehicles, while another 5% was earmarked for giga-projects like the $500 billion NEOM, a futuristic 110-mile-long "linear smart city".

PIF has formed a joint venture with Taiwan's Foxconn to boost its investments in the nascent electric vehicle industry. The fund has also invested in Lucid, an electric carmaker, with an $8.9 billion stake constituting about 25% of PIF's equity holdings. PIF controls about 60% of Lucid's outstanding shares.

PIF's other investments in the electric vehicle industry are not disclosed, but the fund has a diverse investment strategy and is committed to managing high-quality investments domestically and internationally. PIF has invested in some of the world's most innovative companies, forming partnerships to ensure Saudi Arabia is at the forefront of emerging trends while supporting the Kingdom's Vision 2030 blueprint.

In addition to electric vehicles, PIF has invested in other new and promising sectors such as construction, building components and services, consumer goods and retail, entertainment, leisure and sports, food and agriculture, telecom, media and technology, transport and logistics, and utilities and renewables.

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