Ronaldo's Lucrative Saudi Arabian Offer: Implications for the Sporting and Football World
According to sources, Saudi Pro League (SPL) club Al-Nassr FC has offered Cristiano Ronaldo a 3.5-year contract, worth over USD 119 million per year. Should he accept, Ronaldo's contract would dwarf those of all other team-sport athletes, making him the highest paid athlete in the world. In this commentary, we discuss the implications of this offer on the sports world and, specifically, how the SPL could affect European football and Major League Soccer (MLS).Key highlights include:
-- Individual sports leagues are much more vulnerable to the risks of Saudi Arabian and other foreign investment, similar to LIV Golf’s impact on the PGA tour, than team-sports leagues.
-- SPL investment will, however, inflate European football wages, which could affect the competitiveness of European football clubs over the medium term.
-- SPL investment will have a more meaningful impact on MLS and threaten a key aspect of its business model.
“While we expect Saudi Arabian investment in sports to pose a greater near-term risk to individual sports like golf, tennis, mixed martial arts, and racing, it could have a medium-term ripple effect on European football leagues and a more immediate impact on MLS”, said Michael Goldberg, Senior Vice President of Sports Finance at DBRS Morningstar.
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